Uranium sale billions lost as India opts out

From today’s Sydney Morning Herald:

Australia’s plans to sell uranium to India appear certain to be scuttled after the Indian Government announced it was unlikely to sign a pact with the US on civil nuclear co-operation.

The US-India deal was a pre-condition to the planned sales of uranium because India is outside the nuclear non-proliferation treaty and Australia bans sale to non-signatories. The US-India civil nuclear agreement was considered by the Australian and US governments to include sufficient safeguards to allow sales to India to proceed.

The sales were likely to have been worth billions in export dollars because India plans to use nuclear energy to meet its burgeoning power needs.

With 24% or so of the world’s Uranium, currently enjoying an appreciating market, I don’t imagine we’ll have trouble finding buyers.

What was India’s stupid problem, though?

The Indian Prime Minister, Manmohan Singh, has told the US President, George Bush, that “certain difficulties” would prevent India from moving forward on the pact for the foreseeable future.

The main obstacle is not the agreement itself but rather India’s internal politics, including fears from the communist parties in the ruling coalition that India is moving too close to the US, officials and experts familiar with the deal said.

Besieged for two months by growing opposition to nuclear energy co-operation with the US, Mr Singh indicated over the weekend that he would rather save his government than the pact.

Readers may recall that Singh was not popular when he first went in for this deal with the Americans. Looks like he stayed that way. Ultimately it serves the big baskers like John Howard and Alexander Downer right – don’t go trying to sell things like Uranium to non-treaty countries – especially crazy ones right next to equally crazy ones, when they still go to near-war on a routine basis.

Having called his election, we shall see whether Howard has to wear this egg on his face into it. Probably as early as this evening/tomorrow.

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