Amendment to India's Nuclear Liability Legislation

India is set to amend its nuclear liability law to cap accident-related penalties for equipment suppliers, aiming to attract foreign investment, particularly from U.S. firms. The move involves altering the 2010 Civil Liability for Nuclear Damage Act, which currently exposes suppliers to unlimited liability in case of an accident.

Background and Need for Amendment

• The 2010 Act was introduced post the 1984 Bhopal gas tragedy to ensure corporate accountability.
• External Affairs Minister S Jaishankar hinted at the need for revisiting the liability law to boost confidence in the international nuclear sector.

Proposed Changes

As per a Reuters report, the Department of Atomic Energy has drafted a law to:

• Cap compensation that operators can claim from suppliers at the original contract value.
• Introduce a specific time limit for such claims.
• Align India with international norms where operators bear primary safety responsibility.

Impact on U.S. Participation

• The amendments are part of Prime Minister Modi’s initiative to increase nuclear power generation to 100 gigawatts by 2047.
• Companies like General Electric and Westinghouse Electric are expected to enter the Indian market post amendment.

Parliamentary and Economic Implications

The revised law requires parliamentary approval, likely to be introduced in the Monsoon Session in July. The passage is crucial for:

• Expanding nuclear energy capabilities.
• Concluding a trade deal with the U.S. aimed at increasing bilateral trade to $500 billion by 2030.

Private Sector Participation

The government is considering private Indian participation in nuclear energy projects, with large Indian conglomerates planning investments around $5.14 billion each.

Historical Context: Bhopal Gas Tragedy

• The Bhopal Gas Tragedy occurred on December 2-3, 1984, involving a toxic gas leak from a Union Carbide India Limited plant.
• About 3,000 people died immediately, with long-term effects causing 15,000-20,000 deaths and affecting over 500,000 people.
• Legal battles ensued, resulting in Union Carbide Corporation settling with the Indian government for $470 million in 1989.
• The 1984 disaster remains the world’s worst industrial catastrophe.