CIVIL NUCLEAR LIABILITY ACT RESOLUTION

WITH USA DURING OBAMA VISIT TO INDIA ON

26TH JAN 2015 INDIAN EXPRESS
THE STICKING POINTS & THEIR RESOLUTION

US demand for "tracking" nuclear material supplied to India on a "cradleto-grave" basis

STATUS: Demand now dropped

Section 17(B) of India's Nuclear Liability Law allows the Indian operator to
recover costs from the supplier if an accident were caused by defective materials
or equipment
STATUS: Impasse resolved by insuring suppliers against Section 17(B) risk

Section 46 of the liability law permitted nuclear accident victims to file tort
claims for compensation under general principles of law
STATUS: India has provided an undertaking, apparently from the Attorney
General, that this liability would not extend to the foreign supplier

Washington and New Delhi have announced they have bridged the gulf that has
deterred US nuclear power generation companies from entering the Indian market
since 2008, when the US-India civil nuclear agreement was signed.
On Sunday, President Barack Obama hailed the "breakthrough" agreement after talks
with Prime Minister Narendra Modi. Modi stated India was "moving towards
commercial cooperation (with the US in nuclear power generation), consistent with
our law, our international legal obligations, and technical and commercial viability."
Yet, the joint statement issued by the two countries contained no details of how both
sides' concerns had been met.
American interest in setting up nuclear plants in India had been stopped dead in 2010,
when New Delhi passed a law called "The Civil Liability for Nuclear Damage Act,
2010" (hereafter Nuclear Liability Act). Departing from global practice, which makes
only the nuclear plant operator liable to pay compensation in the event of a nuclear
accident, India's Nuclear Liability Act allowed for claims to also be made on the
supplier of the nuclear plant and fuel.
US companies like General Electric and Westinghouse, which hope to supply reactors
to India, argued that liability should rest with the operator alone. In India, the
operator is the Nuclear Power Corporation of India (NPCIL).

India's position hardened after the Fukushima Daiichi nuclear disaster unfolded from
March 11, 2011, when a tsunami knocked out emergency power supply in the Japanese
power plant, eventually displacing 150,000 people and triggering a clean-up operation
that will cost some $200 billion.
Three major differences had emerged between the US and Indian sides over years of
negotiations. The first was a US demand, first made in 2012, for "tracking" nuclear
material supplied to India, on a "cradle-to-grave" basis. New Delhi flatly rejected this,
on the grounds that the 2008 agreement with the US only permitted inspections by the
International Atomic Energy Agency (IAEA), that too only within 14 plants placed
under safeguards. The US has now dropped this demand.
The second sticking point was over Section 17(B) of India's Nuclear Liability Law,
which allows the Indian operator to recover costs from the supplier, if an accident
were caused by defective materials or equipment. It was believed that this
responsibility would encourage suppliers to adopt higher safety standards.
This impasse has been resolved by insuring suppliers against Section 17(B) risk, with
General Insurance Corporation (GIC) - India's national re-insurer - which will
establish an insurance pool, from which damage payments could be drawn.
Bloomberg News quotes Amandeep Singh Gill, joint secretary of disarmament in
India's foreign ministry, as saying that GIC and four other public sector companies
would set up an insurance pool valued at Rs 750 crore ($122 million), with New Delhi
contributing more later.
"It appears as if the risk premium is low enough to not place a serious burden on the
suppliers," says Siddharth Varadarajan of Shiv Nadar University.
The third point of dispute flowed from Section 46 of the liability law, which permitted
nuclear accident victims to file tort claims for compensation under general principles
of law. The US companies believe this would expose them to practically unlimited
liability in the event of a nuclear disaster.
The government of India has now provided a written undertaking, apparently from the
Attorney General, that this liability would not extend to the foreign supplier.
Even so, it remains unclear how New Delhi's undertaking would withstand the legal
challenges that seem inevitable. "This would have to be embodied in some form in the
liability law at a future stage," says Varadarajan.

Explained: Significance of Indias uranium deal

with Canada During modi Visit to Canada
Indian Express

Prime Minister Narendra Modi with his Canadian counterpart Stephen Harper, participates in a business
roundtable in Toronto on Thursday. (Source: PTI Photo)
Written by Sushant Singh | Updated: April 17, 2015 8:36 am

Sushant Singh explains the context and significance of the uranium supply deal that was
signed Wednesday following talks between Prime Ministers Narendra Modi and Stephen
Harper
What are the basics of the Modi-Harper uranium supply deal?
It is worth $ 350 million. Canadas largest uranium producer, Cameco Corp, will supply 3,220
metric tonnes of uranium concentrate for Indian nuclear power reactors over five years,
beginning this year. Cameco Corp, based in Saskatchewan in the Canadian prairie, produces,
according to the companys web site, about 16 per cent of the worlds uranium.
Why is this deal significant?
It comes at the end of two years of protracted negotiations that followed the 2013 civil nuclear
deal between the countries. Canada, among the worlds largest producers of uranium, played a
key role in Indias nuclear evolution, having supplied the first Indian reactor CIRUS in 1954.
The exports of uranium and nuclear hardware to India were, however, stopped after New Delhi
used Canadian technology to carry out a peaceful nuclear test in 1974.

Does India have uranium deals with other countries too?

Yes. With Kazakhstan and Australia. It imports around 40 per cent of its requirement
between 2008 and 2014, imports of uranium totalled 4,458 metric tonnes, 2,058 MT of which
came from Russias Tvel Corporation, 2,100 MT from NAC Kazatomprom of Kazakhstan, and
300 MT from Areva of France.
Why does India need uranium?
India has 21 operational nuclear reactors and six under construction, which use uranium as
fuel. The nuclear component of Indias energy production is currently under 3 per cent at 6,000
MW. By 2032, India expects to have 45,000 MW of nuclear capacity, provided it has assured
uranium fuel supplies. At a press conference on Wednesday, Prime Minister Narendra Modi
described uranium as not just a mineral but an article of faith (for India), and an effort to save
the world from climate change.
Is uranium concentrate used directly in reactors?
No. Uranium is a naturally-occurring element in the earths crust, and mining takes place in
locations where it is naturally concentrated. To make nuclear fuel, uranium extracted from
mines is first stored as uranium oxide concentrate a bright yellow substance sometimes
referred to as yellow cake which is then enriched into uranium-235 isotope, before being
made into pellets that are loaded into the nuclear fuel assembly.
How much uranium does India produce?
The government does not release data on local uranium production, but it is estimated to be
around 350-400 MT. Total Indian reserves are estimated at 181,600 MT, mainly in Andhra
Pradesh, Jharkhand and Meghalaya.