by Hely Desai
The current situation in Bangladesh, marked by the fallout from months-long student protests and the subsequent resignation of former Prime Minister Sheikh Hasina, has plunged the country into uncertainty. Despite an interim government now taking charge and attempting to navigate the volatile internal dynamics, violence against minorities, vandalism, as well as damage to public property continue across Bangladesh. Amidst this chaos, the future of the Awami League-led Hasina government’s legacy projects and achievements appears tenuous.
Touted as a political, developmental, and strategic achievement under the Hasina government, the Rooppur nuclear power plant project was a step forward in addressing Bangladesh’s decades-long struggle with severe power outages, depletion of natural gas reserves, and alarming pollution levels, as well as aimed to reduce energy import dependency amidst a crumbling economy. However, with an interim government in place, ensuing elections, and potential shifts in geopolitical partners due to changing political alliances on the horizon, the Rooppur project’s trajectory is fraught with uncertainty. Things might get murky if and when a new dispensation either in the form of a Bangladesh Nationalist Party (BNP)-Jamaat-e-Islami alliance post elections – or a military backed-king’s party in case of a prolonged election – come to power.
Rooppur Nuclear Power Plant: A Strategic and Economic Milestone
Almost 100 miles northwest of the tumult-ridden Dhaka, Bangladesh began the construction of its first nuclear power plant in Rooppur in 2017, with a generation capacity of 2,400 MW and an estimated construction cost of USD $12.65 billion. Nearly 90 percent of the cost of the Rooppur power plant was financed by an intergovernmental credit agreement from Russia, with repayments spread over decades at minimal interest rates. The first unit, with a capacity of 1,200 MW, was anticipated to begin commercial operations by December 2024 following considerable delays. The second unit was due to be operational in 2025, with plans under the Sheikh Hasina government to potentially expand the project by adding two more units. Built with ambitious goals for industrial growth and modernization, the nuclear power plant was aimed at providing a consistent power supply, enabling the expansion of industries, creating jobs, and attracting foreign investment, thereby contributing to the country’s gross domestic product (GDP) growth and helping lift more people out of poverty.
When Bangladesh inked the agreement for Rooppur in 2011, the country was increasingly emerging as a site of geopolitical competition fueled by aid, trade, and infrastructure projects. China’s pursuit of a greater foothold in the Southern Asian region through the Belt and Road Initiative (BRI) led to a surge in energy projects in Bangladesh such as the U.S.-led Bangladesh Advancing Development Growth through Energy (BADGE), China-funded solar parks, and India-backed thermal power plants. Despite initial advances by China to fund nuclear energy projects in Bangladesh, the Awami League’s cordial history with Russia led the Hasina government to accept an offer by Moscow’s state-owned energy corporation Rosatom to finance the Rooppur project in 2011. Later, post the tripartite memorandum in 2018, India was brought onboard to provide personnel and technical assistance on the development of the plant.
Domestic political turmoil could impact the interim government’s priorities, potentially affecting the Rooppur project’s timeline and internal funding. The recent upheaval has already strained the economy. Restoring Bangladesh’s economic stability and domestic normalcy would be higher up on the priority list of the interim government than the swift completion of the nuclear project. Currently, the interim government is focused on pressing issues like restoring law and order and instilling reforms for the facilitation of free and fair elections. Continued violence could divert attention and resources away from long-term investments like nuclear energy and cause supply chain disruptions. Their short-term focus has already led a foreign affairs advisor to reassure the Russian Ambassador to Dhaka that the interim government is keen to continue their cooperation on Rooppur. Still, the current political and economic instability could significantly affect the completion and operation of the Rooppur nuclear power plant, disrupting supply chains, delaying construction schedules, and deterring further foreign investment.
Out with the Old, In with the New
If Bangladesh sees a “king’s party” take over the government with the military’s blessing, the Rooppur project may see an overhaul. Under these circumstances, the military would likely try to project its image as a temporary and stabilizing force for the dispensation it is backing rather than as a permanent political actor. Mindful of how its actions are perceived by international partners, it will likely take a cautious approach towards new agreements while reevaluating existing agreements like Rooppur. The project is much costlier compared to similar facilities in other countries due to high import costs and a lack of local expertise. Recent allegations have also emerged that Sheikh Hasina and her family embezzled funds from the Rooppur project in collusion with Russian officials. These two factors may influence a military-backed government to renegotiate the terms of the long-term Russian credit agreement or otherwise overhaul the project. The military-led government may see this as an opportunity to demonstrate its commitment to good governance and fiscal responsibility, enhancing its image as a caretaker of national interests.
If the military fails to either renegotiate or reaffirm the Rooppur project, this could exacerbate economic uncertainties like cost overruns, inflation pressures, and repayment deferrals, thereby undermining the project’s viability. This timid approach could pose significant risks if it leads to inaction or delays in addressing the urgent issues surrounding ongoing projects like Rooppur. It may squander opportunities for necessary reforms like budget controlling, instilling transparency, and accountability in project management and regulatory oversight. Without clear and proactive measures, such caution may ultimately hinder Bangladesh’s nuclear ambitions and leave the nation entangled in unresolved challenges that could worsen over time.
A more likely scenario is that an alliance led by the Bangladesh Nationalist Party (BNP) and Bangladesh Jamaat-e-Islami parties will come to power after elections. The BNP, vocally critical of Rooppur, had previously bogged down the negotiations of the project in 2001. If such a government comes to power, the continuation of Sheikh Hasina’s legacy projects like Rooppur with allies such as Russia and India will come under fire from the traditionally China-favoring BNP and its leader Khaleda Zia. Beijing, too, views Bangladesh as a critical node in the BRI. Having invested in projects like the Chittagong port expansion, China is likely to support a stable government to ensure the continuation of its projects and maintain its influence, dodging Russian presence in this backyard. Having recently secured a contract to construct a gamma irradiation facility at the Bangladesh Institute of Nuclear Agriculture through a subsidiary of China National Nuclear Corporation, Beijing is looking to deepen its influence in varied aspects of the nuclear realm in the region. Washington, given its renewed focus on the Indo-Pacific region as part of competition with China, might also see an opportunity to strengthen ties with a BNP-led government through energy cooperation and potentially offer support for renewable energy initiatives or other critical infrastructure projects.
Dashed Economic and Energy Dreams?
If the succeeding government succumbs to continued historical biases and geopolitical chaos, neglecting the smooth continuation of the near-completion Rooppur project, progress on the country’s energy infrastructure risks being pushed back by decades. Depending on the political scenario that arises, possible outcomes for the nuclear future of the country may range anywhere from slow but continued development with the project taking a backseat temporarily under the current interim government’s stability-centric approach, stalling with cautious and costly setbacks under a military-led regime, or a more dramatic scaling back or suspension of the project under a BNP-Jamaat led rule.
For Bangladesh, nuclear energy is a critical component of its strategy to diversify its energy sources and achieve sustainable growth. Abandoning or indefinitely delaying the Rooppur nuclear power plant would mean continued severe energy shortages and increased reliance on costly fossil fuels, worsening environmental and economic conditions. It would strain ties with key allies like Russia and India, erode investor confidence, and impede Bangladesh’s long-term energy security and technological development in the nuclear sector. The decisions made now could impact not only the nation’s energy future but also its perception among regional and global partners. A pragmatic strategy of maintaining strong ties with Russia and India on ongoing projects like Rooppur while simultaneously engaging with the United States and China would be challenging but potentially advantageous for the country. This balancing act could help Bangladesh leverage benefits from multiple international actors while securing its strategic and economic interests.
The Rooppur nuclear power plant’s future is closely tied to Bangladesh’s current imbroglio. As political dynamics evolve, maintaining commitment to Rooppur will be essential for sustaining energy security and ensuring long-term growth and stability. Adjustments to timelines and management strategies may be necessary, but the commitment to nuclear energy needs to be upheld for Bangladesh’s energy future and geopolitical standing.
source : southasianvoices