A New Era of Engagement: First Shipment of Canadian Uranium Reaches India

On December 3, the first consignment of Canadian uranium Cameco has ever sold to India reached the Port of Mumbai. This delivery is part of an agreement for Cameco to deliver 7.1 million pounds of uranium concentrate to India through 2020. While this delivery did not receive a great deal of publicity in the media, it is the result of many years of negotiation and is highly significant for Canada’s relationship with India for a number of reasons.

First, this delivery is one of the first commercial outcomes of the Canada-India Nuclear Co-operation Agreement that came into force in September 2013. The sale of uranium has led Canada’s engagement with India’s nuclear energy industry because India desperately needs uranium to fuel its growing fleet of nuclear power plants, but is highly self-sufficient and cost competitive in the area of nuclear energy technology and services. Last week’s delivery has moved the commercial aspect of the Canada-India nuclear energy relationship from the theoretical to the concrete with more Canada-India collaborations, especially in the areas of research partnerships, expected in the coming months.

Second, the deal highlights the importance of India to Saskatchewan’s economy. Saskatchewan currently leads Canada’s provinces in exports to India with a total of almost $1.2 billion annually, mostly in the area of the “three F’s” — food, fertilizer and fuel. Saskatchewan is home to all of Canada’s producing uranium mines and the province is seeking new markets for its uranium as nuclear energy demand in Canada and the United States looks less certain.

Third, the process of negotiating the deal highlights the importance of both private sector relationships and strong government support in getting deals done in the nuclear energy industry. A former president of Cameco is legendary in nuclear energy circles for making six trips to India to cultivate relationships with companies even before Canada concluded a nuclear co-operation agreement.

The Governments of Saskatchewan and Canada were also highly committed to supporting the deal. Canada will need to continue to show this commitment to the industry as Australia, the world’s third largest producers of uranium, has now concluded a nuclear co-operation agreement with India and can start to sell into that market.

Fourth and most important, the delivery closes the door on a somewhat dark chapter of distrust between Canada and India that followed Canada’s decision to end nuclear co-operation with the country in 1974 after India tested a nuclear weapon developed from Canadian technology. This confrontation over issues of nuclear non-proliferation negatively affected almost all aspects of the Canada-India relationship and hindered Canada’s ability to further economic and political goals in non-nuclear sectors. Tellingly, no Indian Prime Minister visited Canada after 1974 until Prime Minister Modi’s visit in 2015.

Canada and India have entered a new era of engagement. That the Nuclear Co-operation Agreement has led to a concrete outcomes in the form of uranium trade indicates that the Canada-India’s stalemate on nuclear has finally come to an end.