India's nuclear liability law has continued to play spoiler for the nation's civil nuclear deal with the US, and it turns out it may have also delayed a potential deal with Russia to set up two more nuclear reactors in Kudankulam.
The Indian Express reported that as a sign of co-operation the Kudankulam plant's first reactor was to be linked to the state's power grid around the time Prime Minister Manmohan Singh met with President Vladmir Putin. This is the last state visit to Russia of the Prime Minister's current term in office.
The linking of the power plant to the grid was set to precede India and Russia clinching the deal to set up two additional nuclear reactors in the controversial Kudankulam plant. However, before inking the deal the Russians voiced concerns that stalled it.
"We are very close to an agreement, we have settled most of the issues ... it is with the lawyers of both sides at present ... In any case, it won't be signed in Moscow during the prime minister's visit," an unnamed source was quoted as saying by IANS.
It turns out that concerns over the Civil Liability for Nuclear Damage Act are reportedly what prompted both nations to seek legal opinion and prompt a last stage of vetting of the deal before it is signed.
Russia has set up the two 1,000 MW existing nuclear reactors in Tirunelveli district of Tamil Nadu and the plant, which is run by the Nuclear Power Corporation of India, is proceeding with power generation despite continuing protests from local residents.
India has reportedly offered a solution to make the deal more palatable to Russian suppliers.
According to the Indian Express, India had reportedly suggested that the General Insurance Corporation could tie up with the Department of Atomic Energy to come up with a 'rate chart' and time frame to seek redressal from material suppliers like Russia.
This was expected to allow suppliers to know exactly how much they would be liable to pay in the event of a nuclear disaster but this compromise is being vetted by the Russian government before it approves the deal.
The nuclear liability law is often cited as the reason that power firms from the US have chosen to stay away from India despite the civil nuclear power deal between the two nations. Power firms in other nations have also expressed concerns over it.
During the Prime Minister's recent visit to the US, there was a controversy that erupted over allegations the government was trying to bypass the law. With a model fixing the liability of suppliers in advance, the government may be able to quell some of the concerns over the law in other countries, but may face political opposition at home for it.
Updated Date: Oct 21, 2013 11:13 AM