Union cabinet clears N-liability bill

New Delhi: In a last minute move aimed at clearing hurdles to the implementation of the Indo-US civil nuclear deal between India and American companies, the Union cabinet on Thursday cleared the Civil Nuclear Liability Bill, through which the Government of India assumes indirect responsibility for compensation in case of a mishap.

In the event of a nuclear accident, compensation will be capped at Rs2,500 crore. It will be facilitated through the Nuclear Power Corporation of India Ltd, a Government of India-owned entity.

With Cabinet approval the bill may now be introduced in Parliament. It is uncertain if it will be legislated upon in the ongoing session.

Under the main provision of the bill, the responsibility of paying compensation, in case of a nuclear accident, will rest on the operator and not the supplier. This mostly refers to foreign companies building and installing nuclear facilities in India.

For western firms, particularly those in US, the liability law is essential for conducting business with India, and accordingly, Washington has been anxious that India enact such legislation.

Once the bill is legislated, India joins the international convention on liability in the civil nuclear arena.

The 2008-09 Economic Survey had pointed out that efforts to get foreign nuclear companies to invest in India had failed in the absence of such legislation on liability and required amendments made to the Atomic Energy Act to allow private participation.

India has launched a massive programme for nuclear capacity addition of 65 GWe by 2032.