India Nuclear News And Discussion

[Sanatanan]

PM bent on clearing nuclear liability bill this session
By Harish Gupta, DNA, Tuesday, Aug 17, 2010

Prime minister Manmohan Singh has sent out strong signals that he cannot wait indefinitely for the passage of the Civil Liability for Nuclear Damage Bill in Parliament. He is keen on seeing it through in the monsoon session; he is prepared to extend the session if the opposition gets in the way by disrupting House proceedings.

. . . .

Reddy has made it clear that the amount of compensation cannot be enhanced to billions of dollars as is being demanded by the opposition. The supplier, operator and all concerned, however, will be made liable to stringent penalties.

. . . .

[abhishek_sharma]

Deal paves way for nuclear liability Bill

http://www.hindu.com/2010/08/18/stories ... 440100.htm

Among the changes agreed upon are trebling of the operator liability cap from Rs. 500 crore to Rs. 1,500 crore and specific exclusion of private operators in the nuclear sector.

The government seems to have also agreed to raise the limit for filing claims – in the event of a nuclear accident – from 10 years mentioned in the Bill to 20 years. It has agreed to specify “the Bill applies to plants operated by the government or government-owned companies.”

[Sanjay M]

http://economictimes.indiatimes.com/new ... 328460.cms

NEW DELHI: The UPA government has secured the support of BJP for the nuclear liability bill after it made concessions which, among other things, include shutting out private players from the nuclear sector.

What is the purpose of this measure? What interest is served by this? From whose side does this requirement originate, and at whose urging?

[putnanja]

http://economictimes.indiatimes.com/new ... 328460.cms

NEW DELHI: The UPA government has secured the support of BJP for the nuclear liability bill after it made concessions which, among other things, include shutting out private players from the nuclear sector.

What is the purpose of this measure? What interest is served by this? From whose side does this requirement originate, and at whose urging?

One of the fears expressed was that the government would pass the bill with minimum operator liability and later on allow private players (read US) into operating nuclear plants in India with minimum liability

[D Roy]

So they have put into a bill what was known all along that private utilities won't be exclusively operating a plant anytime soon...
the new liability amount would however increase the cost of electricity ...

[Sanjay M]

So they are eliminating the potential benefits of private sector competition in the energy industry. I fail to see how this will help Indians achieve energy independence.

Eliminating private sector participation in order to avoid the question of limiting their liability seems to me like cutting off your nose to spite your face.

[Sanku]

Well as per the reports, following critical issues have also been addressed

1) The suppliers of materials do not have a automatic blanket amnesty
2) The decisions and issues can be referred to the High/Supreme Courts
3) The period of addressing issues/liabilities is up to 20 years
4) It is clear that only GoI would continue to build/operate the plants (thus sidestepping issues of liabilities in a Enron like situation)
5) The liability amount is less of a joke now.

All in all very +changes, for a opposition which is constantly derided as being toothless, powerless and on the verge of fading away -- substantial victories in terms of changes in Bill from a total sell out which it was earlier.

A substantial victory for OUR system too -- a much needed restoration of prestige to the parliament which was battered heavily by the ill behavior during Nuclear bill I episode and recently by Sports minister when he ridiculed the Parliamentary system by asking the house to file a RTI.

[amit]

Oddly enough, nobody complains about the lacunae in the India-Russia agreement

Article 13 states: “The Indian Side and its authorised organisation at any time and at all stages of the construction and operation of the NPP power units to be constructed under the present Agreement shall be the Operator of power units of the NPP at the Kudankulam Site and be fully responsible for any damage both within and outside the territory of the Republic of India caused to any person and property as a result of a nuclear incident occurring at the NPP.”

It is indeed surprising. The deafening silence, even on this thread, is almost eerie.

But of course congratulations for the victory achieved. Private players are out, so no US of A operators of nuclear plants - but of course nobody has been able to identify this mythical beast, that is a private sector US nuclear plant operator which has expressed interest in running a nooklear plant in India. So what if the likes of Reliance and other Indian entities who were lining up with billion dollar plus investments have been banned too. But I suppose its for the best, who trusts these private sector types anyway, nah? So what if we get that many less plants up and running?

[amit]

Eliminating private sector participation in order to avoid the question of limiting their liability seems to me like cutting off your nose to spite your face.

A wag once said: The best cure for a headache now and in future is to cut off one's own head. No head, no headache!

[Sanjay M]

I think Indian interests would have been better served by Reliance, Tata, etc getting involved in operating reactors to supply energy. They would have expanded much faster than any govt-run entity.

[D Roy]

that is exactly the point.

the establishment is worried that pvt sector participation at this stage will lead to a hemorrhaging of talent which will put all existing projects in jeopardy.

besides the existing utility nobody is even remotely close to understanding how to operate a phucking nuke plant in this country. They know about the 'conventional island' but as any industry insider will admit they just don't have what it takes right now to operate the nuclear steam supply unit. they are not ready.

basically there simply isn't enough broad based expertise. at the moment to have new entrants. And given concerns over safety nobody is gonna risk their necks anytime soon.

So what you are gonna see is JVs between the public utility and select private players till pvt players "mature" to stake it out on their own.

The Pvt sector will mainly reap dividends on the manufacturing side for the next decade and a half.

[D Roy]

then there is also a question of a rather limited number of sites suitable for large LWRs ....

[arnab]

Well as per the reports, following critical issues have also been addressed

1) The suppliers of materials do not have a automatic blanket amnesty
2) The decisions and issues can be referred to the High/Supreme Courts
3) The period of addressing issues/liabilities is up to 20 years
4) It is clear that only GoI would continue to build/operate the plants (thus sidestepping issues of liabilities in a Enron like situation)
5) The liability amount is less of a joke now.

All in all very +changes, for a opposition which is constantly derided as being toothless, powerless and on the verge of fading away -- substantial victories in terms of changes in Bill from a total sell out which it was earlier.

A substantial victory for OUR system too -- a much needed restoration of prestige to the parliament which was battered heavily by the ill behavior during Nuclear bill I episode and recently by Sports minister when he ridiculed the Parliamentary system by asking the house to file a RTI.

Of these only 3 and 5 are relevant to the new bill. Interestingly, as far as I can see the new 'opposition agreed' bill does not close the door on private operators in future. It only says that the provisions of this bill are applicable to government operators. (which of course makes point 5 irrelevant and would only lead to increasing the price of electricity)

[abhishek_sharma]

Government set to let suppliers off the hook

http://www.hindu.com/2010/08/19/stories ... 980100.htm

Their hand-wringing and finger-pointing over Union Carbide now behind them, Congress and BJP legislators came together on Tuesday to recommend modification of the proposed law on civil nuclear liability to let foreign suppliers of equipment off the hook for any accident caused by their negligence.

In its report submitted to Parliament on Tuesday, the Standing Committee on Science & Technology suggested a change in the nuclear liability Bill, making the recovery of damages from a supplier — even in the event of gross negligence — contingent upon his prior acceptance of liability in a written contract. This is a major dilution of the existing provision.

The reason for this last minute modification is presumably the September 2008 promise the Manmohan Singh government made to the U.S. to “take all steps necessary to adhere to the Convention on Supplementary Compensation for Nuclear Damage (CSC).” The U.S. wants India in it because Indian victims of an accident would then be barred from filing damage claims in U.S. courts in the event of an accident caused by American-supplied equipment.

The CSC limits the operator's right of recourse essentially to what his contract with the supplier provides for. Despite this, Indian officials, aware of the link between liability and safety, included supplier negligence as a standalone ground. But in the face of U.S. pressure, the government is now trying to retrofit the Bill to make it CSC compliant.

Globally, South Korea and Hungary provide the operators with a right of recourse against the suppliers in the event of gross negligence, regardless of whether or not the contract provides for it or not. Even with a trusted friend like Russia, India is having a tough time including a right of recourse in the contract. That is why the Bill envisaged explicitly giving the operator the right in the event of the supplier's gross negligence.

[abhishek_sharma]

Nuclear deal: Elusive benefits, tangible costs

Brahma Chellaney

With accident-liability protection constituting another layer of state subsidy to foreign reactor vendors, the spectre of dozens of Enrons in the nuclear-energy sector is real.

[Sanjay M]

x-posting:

Modi let off in return for BJP support on N-liability bill: Lalu

To me, it looks like INC has deliberately raked up the Sohrabuddin issue specifically to create a way to arm-twist BJP on the nuclear deal. That they would resort to coercive measures to achieve this seems to indicate an extraordinary sense of urgency on INC's part in getting the nuclear deal done.

I have warned before that INC may be striking grand bargains with the US as quid pro quo to keep itself in power as a One Party State. This latest Sohrabuddin stunt seems consistent with that idea.

I don't feel that stable or mutually advantageous Indo-US strategic relations can be based on foreign sponsorship of a King's Party to make sure that 1 billion+ people toe the line.

[Karan Dixit]

Aug. 18 (Bloomberg) -- India is set to introduce a revised bill to cap liability for nuclear accidents, resolving a two- year standoff that’s kept companies including General Electric Co. out of the nation’s $175 billion atomic energy market.

http://www.businessweek.com/news/2010-0 ... to-ge.html

[SSridhar]

N-Power operations must remain in Govt. hands

Courtesy: Business Line

The Parliamentary Standing Committee on Science and Technology, Environment and Forests, which was entrusted with reviewing ‘The Civil Liability For Nuclear Damage Bill, 2010', has clarified the definition of a nuclear power plant “operator” to strictly exclude private players. The creation of a nuclear liability fund, beefing up suppliers' liability in the event of an accident and a three-fold hike in the operator's liability cap are among the other key recommendations.

On the rationale for excluding private operators, the report said that some of the witnesses who appeared before the Committee expressed their apprehension that private operators may enter the nuclear sooner or later and that the Government should not give subsidy to the private nuclear operators (in the form of overall liability cover). “The Committee has taken their suggestions into account,” the report said.

To make the right of recourse against suppliers more stringent, the committee has suggested a beefing up of Clause 17 of the Bill, which in its original form is “quite vague”. The panel has suggested that clause 17 (b) should be modified to establish clear cut liability on the supplier of nuclear equipment or materials in case they are found to be defective. The committee has recommended that the operator must secure his interests through appropriate provisions in the contract with the supplier.

In the event of an accident, the Bill provides for appointment of a Claims Commissioner and a Nuclear Damage Claims Commission to dispose off claims within three months. The Committee has further recommended that “victims shall have the right to appeal to the High Court and Supreme Court…”

Mr Reddy said the Left members had given a note of dissent but all other members were in agreement with the recommendations. On the demand of the Left and the Bharatiya Janata Party against joining the Convention on Supplementary Compensation (CSC), Mr Reddy said it was for the Government to take a decision “in the interests of the nation”.

[Amber G.]

By Saurav Jha:
Atomic noughts and crosses

[amit]

I find these two reports from the Hindu stable slightly contradictory when read together

N-Power operations must remain in Govt. hands

[Businessline]

...To make the right of recourse against suppliers more stringent, the committee has suggested a beefing up of Clause 17 of the Bill, which in its original form is “quite vague”. The panel has suggested that clause 17 (b) should be modified to establish clear cut liability on the supplier of nuclear equipment or materials in case they are found to be defective. The committee has recommended that the operator must secure his interests through appropriate provisions in the contract with the supplier.

And:

Government set to let suppliers off the hook

[Hindu]

In its report submitted to Parliament on Tuesday, the Standing Committee on Science & Technology suggested a change in the nuclear liability Bill, making the recovery of damages from a supplier — even in the event of gross negligence — contingent upon his prior acceptance of liability in a written contract. This is a major dilution of the existing provision.

Does it mean that future contracts with equipment suppliers would need to have a liability clause built into it? If so, can the inducement of Indian market, allow Indian operators to take a take and leave it stance?

Also does the agreement with the Russians supersede the provisions of this bill?

Can some kind soul please explain this to me?

[Sanku]

The contradictory reports suggest that the matter of the bill is not yet sorted out after all, it seems the Govt is still trying to go with as loose a bill as possible and the opposition trying to make things crystal clear.

The battle is still being played out through selective leaks in media.

[Raja Ram]

SSridhar,

Did you notice some of the changes that have come through are precisely the ones that was covered during the presentation?

Still need to watch the final shape of the bill.

[SSridhar]

Does it mean that future contracts with equipment suppliers would need to have a liability clause built into it? If so, can the inducement of Indian market, allow Indian operators to take a take and leave it stance?

The effort of the US has been to make India compliant with the CSC because as largely a 'supplier' nation, it wants to protect its interests. The right to recourse is thus limited only to the operator, not to the affected people. Now, the government is saying that unless there is a 'liability clause' in the agreement between the supplier and the operator, the operator cannot claim anything from the supplier. The law makes this point clear cut. Now, in the agreements with the US suppliers, there won't be any such liability clause. India has promised the US to buy 10000 MWe of reactor and equipment. So, for the US supplied plants, the Indian operator has to bear the claims. The claims, unlimited, could also come from our neighbours, if they are affected.

In the Russian deal, there is no specific 'right to recourse' clause and so NPCIL cannot go back to them, if God forbid, there is an incident directly attributable to defective design or components supplied by Russia.

[SSridhar]

SSridhar,

Did you notice some of the changes that have come through are precisely the ones that was covered during the presentation?

Still need to watch the final shape of the bill.

Raja Ram, yes.

[amit]

The effort of the US has been to make India compliant with the CSC because as largely a 'supplier' nation, it wants to protect its interests. The right to recourse is thus limited only to the operator, not to the affected people. Now, the government is saying that unless there is a 'liability clause' in the agreement between the supplier and the operator, the operator cannot claim anything from the supplier. The law makes this point clear cut. Now, in the agreements with the US suppliers, there won't be any such liability clause. India has promised the US to buy 10000 MWe of reactor and equipment. So, for the US supplied plants, the Indian operator has to bear the claims. The claims, unlimited, could also come from our neighbours, if they are affected.

Thanks for the clarification Sridhar. But I'm curious, the bolded portion, is that your personal assessment or is their specific evidence for the same in the form of commitments from India? I ask this question is because if India has already committed to not have such liability clauses then why was there so much noise in the first place and why this effort to "redress" things.

In the Russian deal, there is no specific 'right to recourse' clause and so NPCIL cannot go back to them, if God forbid, there is an incident directly attributable to defective design or components supplied by Russia.

IMO this just goes to show that every country is the same, that is if given an opportunity they will arm twist India to get a favourable deal. Hence I fail to see the reason - in this specific case - to demonise the US and shore up the French and Russians. All are equally bad in the sense they will be batting for their interests.

The best recourse is to develop the technology in the country.

JMTs and all that

[amit]

The contradictory reports suggest that the matter of the bill is not yet sorted out after all, it seems the Govt is still trying to go with as loose a bill as possible and the opposition trying to make things crystal clear.

The battle is still being played out through selective leaks in media.

Sanku,

You need to have a closer look at the two stories. The Bussinessline story is dated Aug18 and is bylined Our Bureau - meaning it's a straightforward News story.

The Hindu report - dated Aug 19 - on the other hand is a Commentary/Opinion piece by our good friend Siddharth Varadarajan and is typically slanted to the Chindu line set by the venerable Ramji. Chindu, IMO, is not very happy that the UPA took into consideration inputs from BJP while ignoring the Left's inputs.

Both articles are interpreting the same thing in different ways which means the bill has been written up, obviously with BJP inputs. So there's no question of the bill not yet being sorted out. Of course it may go further changes in Parliament but that's for later, as of now the draft is ready, IMO.

[SSridhar]

Now, in the agreements with the US suppliers, there won't be any such liability clause.

But I'm curious, the bolded portion, is that your personal assessment or is their specific evidence for the same in the form of commitments from India?

Amit, that's purely my personal opinion. The Bhopal incident, and the ongoing Dow Chemicals tug-of-war, must have taught lessons to all players. Some may not learn.

IMO this just goes to show that every country is the same, that is if given an opportunity they will arm twist India to get a favourable deal.

Make no mistake about that. As we go up and take our well-deserved seat in the top table, we have to learn to negotiate hard.

[amit]

Amit, that's purely my personal opinion. The Bhopal incident, and the ongoing Dow Chemicals tug-of-war, must have taught lessons to all players. Some may not learn.

IMO this just goes to show that every country is the same, that is if given an opportunity they will arm twist India to get a favourable deal.

Make no mistake about that. As we go up and take our well-deserved seat in the top table, we have to learn to negotiate hard.

Thanks for clarifying matters Sridhar. And yes I fully agree we need to negotiate very hard, with everyone. Let's remember there are no permanent enemies only permanent interests. While the Russians have traditionally been our friends because our geopolitical interests have invariably coincided there's no need to look at them as our equivalent to the Taller than Mountains Deeper than Oceans friend of our western neighbour. Similarly we should be wary of Amir Khan but that doesn't mean we shouldn't engage and look at every issue on merit. Again it boils down to realpolitic and negotiating with a pro-India stand.

JMTs

[Sanku]

Amit; "written" is not what I meant when I say "sorted out", which essentially means a fully closed version where both sides have a mutual agreement, there appear to be some clauses being bounced around in one or two versions before the bill finally hits the parliament.

Clearly some last minute cloak and dagger stuff....

[amit]

Amit; "written" is not what I meant when I say "sorted out", which essentially means a fully closed version where both sides have a mutual agreement, there appear to be some clauses being bounced around in one or two versions before the bill finally hits the parliament.

Clearly some last minute cloak and dagger stuff....

Fair enough if that's what you think.

I personally think SV's spiel is just symptomatic of the Left's anger at becoming impotent in this particular area that is the Nuclear deal. If you remember their intransigence on this deal was the start of their downfall as far as being King makers in India is concerned. It must hurt that the Congress is more willing to accommodate the BJP (which I personally think is a very good thing, as these agreements should be as broadbased as possible) than the defunct Leftists.

I'm sure you've noticed the subheader to SV's article:

Two Left MPs submit dissent notes, protesting dilution of 17(b)

“Sheet inserted into printed report to accommodate the change”

[Sanku]

I could believe that if I did not think that SV has not been holding the brief for the "left" but for some other entities, but as you said, certainly in the realm of personal viewpoint.

[shukla]

India, Japan to discuss nuclear pact, UN reforms

Cashing in on the recent launch of nuclear negotiations, India and Japan on Saturday will hold their strategic dialogue that will also flesh out the agenda for Prime Minister Manmohan Singh's visit to Tokyo in October. Japanese Foreign Minister Katsuya Okada touches down on Saturday morning on a day-long visit. External Affairs Minister SM Krishna and Okada will hold delegation-level talks on a wide range of bilateral issues, including ways to scale up economic ties and the UN reforms.

The two sides will review the progress in the two rounds of negotiations for a bilateral civil nuclear pact to iron out differences. There is a strong anti-nuclear domestic constituency in Japan that has been critical of starting nuclear negotiations with a country outside the fold of the Nuclear Non-Proliferation Treaty.

The mayor of Nagasaki, one of the two Japanese cities hit by atom bombs to extract Japan's surrender during World War II, made a declaration Aug 9 which calls for the abolition of all nuclear weapons in the world. However, New Delhi is confident of further progress in negotiations by the time Manmohan Singh visits Tokyo, likely October end. Nudged by the US and France to fast-track the nuclear pact with India so that General Electric Co and France's Areva can use Japanese suppliers for nuclear power projects for India, Japan has decided to accelerate the negotiations.

Japanese companies like Hitachi and Toshiba do not want to miss out on India's growing nuclear pie, estimated to be worth $150 billion. The two sides will also take stock of negotiations for a Comprehensive Economic Partnership Agreement (CEPA) and easing of high-tech trade with India.

This is so heartening.. Japan's coming the full circle!

[Raja Ram]

One should also take a slightly longer time view. India, at one stage will also become a supplier in the global market place. We will then want the same level of protection in terms of limits to the liability exposure.

No supplier would like to be liable when the actual operation of the plant is with the Operator and will like to be liable to something that is proved to be directly liable to the supplied part, design or fuel.

SSridhar, if you recall, I had made this point too.

[SSridhar]

One should also take a slightly longer time view. India, at one stage will also become a supplier in the global market place. We will then want the same level of protection in terms of limits to the liability exposure.

No supplier would like to be liable when the actual operation of the plant is with the Operator and will like to be liable to something that is proved to be directly liable to the supplied part, design or fuel.

SSridhar, if you recall, I had made this point too.

Raja Ram, yes of course. That is what realpolitik is all about, isn't it ? We have to eat the cake ad have it too.

[putnanja]

Rough ride ahead for nuke liability bill

After agreeing with the Congress on changes in the Nuclear Liability Bill, the Bharatiya Janata Party [ Images ] on Thursday opposed an amendment carried out in the final report of the Standing Committee, saying it dilutes provisions relating to supplier's obligations in case of an accident.

The party has made it clear that if the government does not drop its proposed amendment, which it considers as harmful, it would itself move an amendment. In a note to the government, the main opposition party expressed objection to the addition of the word 'and' in the proposed legislation after Clause 17(a) dealing with the right of recourse of an operator of a nuclear plant and a subsequent sub-clause that deals with the supplier's obligations in case of an accident.

...
...
The committee also recommended that the operator "must secure his interest through appropriate provisions in the contract with the supplier".

"The inclusion of 'and' in the amended draft Bill weakens clause 17(a). It appears the word was clumsily added in the bill," Leader of Opposition in Lok Sabha Sushma Swaraj [ Images ] said.

"Since the nuclear power plants are to be operated only by the government or government companies, it would be to our own advantage to delete the word 'and'," said the BJP note handed over to Minister of State for Science and Technology Prithviraj Chavan [ Images ] by party leader Arun Jaitley [ Images ].

"If the government does not agree to the demand, BJP could move an amendment when the bill comes to the Parliament in this session," Swaraj said.

....
Demanding that the cap should be raised to at least Rs 10,000 crore, CPI-M [ Images ] general secretary Prakash Karat [ Images ] said "none of the international nuclear liability conventions set any cap on total liability but only set a floor level".

The clubbing of two clauses on the right of recourse of a nuclear plant operator was aimed at protecting the foreign equipment suppliers, he told reporters after a meeting of top Left leaders.

Referring to Clause 17 of the bill, he said the right of the operator to claim damages from the supplier of nuclear equipment and material (right of recourse) has "now been made entirely contingent on whether such right is explicitly provided in the private contract between the operator and supplier".

In the likely scenario of the foreign suppliers not agreeing to provide for right of recourse in the contract, they cannot be held liable for any nuclear damage, even if they have supplied defective equipment, Karat said.

...
...

[Sanku]

On NDTV right now, as I write there was a coverage of Nuclear liability bill, where there was a case of page 30 -- the page 30 which was actually prepared by the standing committee was torn out of the report and the report which was tabled in the parliament had another page 30 hastily stapled.

This page 30 had the magical "and" inserted. Karat was holding up the report with obvious last minute changes

Obviously as I said last time I posted, there is a last minute skullduggery of the lowest sort at work here.

[rahuls]

On NDTV right now, as I write there was a coverage of Nuclear liability bill, where there was a case of page 30 -- the page 30 which was actually prepared by the standing committee was torn out of the report and the report which was tabled in the parliament had another page 30 hastily stapled.

This page 30 had the magical "and" inserted. Karat was holding up the report with obvious last minute changes

Obviously as I said last time I posted, there is a last minute skullduggery of the lowest sort at work here.

TOI also says this:
Fudge to help N-suppliers caught in time

Can there be more brazen and cheap behaviour than this ? Whom are they trying to cheat ? Who ever has done that should be caught.

[nkumar]

TOI also says this:
Fudge to help N-suppliers caught in time

Can there be more brazen and cheap behaviour than this ? Whom are they trying to cheat ? Who ever has done that should be caught.

This should not come as a surprise. Current administration has least regard for institutions which are essential for efficient governance in a democratic setup. Parliament, Election Commission, investigative agencies...you name it, each have been subverted time and again for narrow political or extraterritorial interests. Very shameful.

[abhishek_sharma]

BJP won't back nuclear bill without supplier liability

http://www.hindu.com/2010/08/20/stories ... 710100.htm

[abhishek_sharma]

BJP hands over note to Chavan on nuclear liability bill

http://www.hindu.com/2010/08/20/stories ... 371600.htm