India ratifies nuclear liability convention

The ratification may attract international nuclear suppliers to invest in the country

By Kundan Pandey
Last Updated: Friday 05 February 2016

India has been planning to construct nuclear plants with the support of foreign players (Tony Fischer/Flickr)

India has ratified the international convention on nuclear energy accident liability, that was perceived as a barrier for foreign companies to invest in the country.

The country submitted an instrument of ratification of the Convention Supplementary Compensation for Nuclear Damage to the International Atomic Energy Agency (IAEA), said a statement published on Ministry of Foreign Affair’s website  on Thursday.

As per the statement, ambassador and Permanent Representative of India to United Nations (Vienna), Rajiva Misra handed over the Instrument of Ratification to Acting Director General of IAEA, Juan Carlos Lentijo. The convention will come into force in 90 days from the date of deposit of the ratification instrument, that is, on May 4, 2016.

It is believed that international manufacturers like General Electric and many others have been reluctant to begin any nuclear project in India because of the country’s domestic liability law which makes all, including equipment suppliers, accountable for any untoward incident. Norms followed globally only hold the plant operators to account, in such a scenario.

India and USA signed a landmark civilian nuclear deal in 2008. However, the two countries could not do business because the US did not agree to subject its companies to India’s liability laws in case of an accident. After the deal, India passed the Civil Liability for Nuclear Damage Act (CLNDA), 2010, which held suppliers liable for compensation in case of any accident caused by faulty equipment and gave the operator (the government) the right to sue them. This is the law which nuclear fuel suppliers, especially from USA and France, have opposed.

India has been planning to construct nuclear plants with the support of several foreign players including Russia, which is building six reactors for India, and planning for six more.

The French President was in India recently, as the chief guest for Republic Day celebrations. The two countries signed an agreement to work on six nuclear plants at the time.

It is noteworthy that India has, in the past, taken steps to address the issue of civil nuclear liability. It had released a list of FAQs on “Civil Nuclear Liability” in February 2015 and also launched the India Nuclear Insurance Pool (INIP) in June that year. INIP is an insurance pool to cover the equipment suppliers’ risk of potential liability.

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