Cabinet clears NPCIL-WestingHouse deal ahead of PM's US visit

Two days before the PM departs for the US, the Cabinet Committee on Security has cleared the early works agreement between India’s Nuclear Power Corporation India Ltd (NPCIL) and America’s WestingHouse, reports CNN-IBN.

According to CNN-IBN, “the agreement would allow the two sides to begin negotiations taking into account all the opposition to the civil suppliers liability clause from the US.”

The clause which is in section 17 of the Civil Liability for Nuclear Damage Act says that in the event of damage caused by a plant, the operator of the plant canseek damages from the provider of equipment.

The law states that damages can be claimed if:

• the contract between the Indian company that runs the plant and the provider of the equipment explicitly states the liability.

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[caption id=“attachment_1132149” align=“alignleft” width=“380”] Representational Image. Getty Images[/caption]

• the accident takes place due to an act of a supplier or his employee or if there is a problem in the equipment provided.

• if there is some data provided or omitted with the intent to cause nuclear damage.

The clause would thus allow NPCIL to change course in case of an accident.

The current clearance will allow NPCIL and WestingHouse to continue negotiations on the 6600 megawatt plant in Gujarat.

The timing is significant as Obama and PM will meet in 2 days and the attempt to show that India and US rapport hasn’t hit a plateau.

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Attorney General Ghoolam E Vahanwati had recently said the public sector company had a legal right to amend the liability clause if it deems it fit. The opinion had kicked up a storm as it was seen as a precursor to diluting the clause in favour of the US company.

The government, however, later assured that it will stick to the prevailing law.

“We have been convinced, and have tried to convince the US negotiators that whatever basis we have of our agreement, there is adequate scope in that for them to get the protection that they legitimately deserve,” Foreign affairs minister Salman Khurshid was quoted as saying in a Times of India report.

This pact will give NPCIL access to the technical knowhow of the US company and is the first one to be signed ever since India passed its civil nuclear law in 2008.

The companies had signed an MoU in 2009 to negotiate a technological and commercial pact for setting up AP1000 pressurised water nuclear reactors in India.