India and Russia on 1 June signed an agreement to construct the final two units at the Kudankulam NPP in Tamil Nadu. It was one of five agreement signed in the presence of Indian Prime Minister Narendra Modi and Russian President Vladimir Putin during the St Petersburg International Economic Forum.
"The economies of India and Russia complement each other in the energy sector. We will strive to build an "Energy Bridge" between our states. We welcome the conclusion of General Framework Agreement and Credit Protocol for Units 5 and 6 of the Kudankulam nuclear plant, Modi told a press conference.
The two 1000MWe reactors will be built by India's Nuclear Power Corporation of India Ltd (NPCIL) and Russia's Atomstroyexport, a subsidiary of state nuclear corporation Rosatom. The two countries also said that there have been "steady and demonstrable" achievements in bilateral civil nuclear partnership, including advancing nuclear power projects at the Kudankulam site and transforming it into one of India's largest energy hubs. Kudankulam 1 began commercial operation in December 2014, and in April this year, India signed an agreement provisionally accepting Kudankulam 2 from Russia marking the reactor's entry into commercial service. Two further VVER-1000 units (Kudankulam 3&4) are planned for the site in the second construction phase. First concrete for those units is planned for the end of June, Rosatom said.
The fifth and the sixth units are expeted to cost INR500bn ($7.7bn) with half of it being funded by Russia as a loan. Construction will take seven years, Nuclear Power Corporation of India (NPCIL) Chairman and Managing Director S K Sharma told PTI. “The first unit will be commissioned in 66 months and the second six months [after that],” he said. “The project will be funded in 70:30 debt-equity ratio (70% debt, 30% equity),” he said. The Russian government will lend India $4.2bn to help cover the construction cost. Sharma said the equity portion of the project would either come from NPCIL’s resources or government.
A joint document issued after the talks said the future of Indian-Russian cooperation holds great promise across a "wide spectrum" covering nuclear power, nuclear fuel cycle and nuclear science and technology.The document, “A Vision for the 21st Century” said the growing partnership in the nuclear power sector between India and Russia had opened opportunities for developing advanced nuclear manufacturing capabilities in India in line with India's "Made In India" initiative. India and Russia commit themselves to earnestly implement the "Programme of Action for Localisation in India" signed on December 24, 2015, and to encourage their nuclear industries to engage closely and foster concrete collaborations, it added.
According to a Rosatom statement, Valery Limarenko, president of Russia’s ASE Group, said: "Extremely important documents have been signed that have been the focus of intensive joint work in recent months. All the formalities have been carried out now to finally launch the project to construct two new power units at Kudankulam using Russian technologies." He added that the project has now entered the "practical phase".