The Ministry of External Affairs (MEA) has released a seven-page set of 'frequently asked questions' refuting speculations over amendment of the Civil Liability Act and also stated that not the suppliers but the operators will be sued by victims of a nuclear accident.
The MEA said both India and US have reached a consensus over the issues such as liability, compensation and the right of recourse in case of nuclear mishap – during three rounds of discussions held with the Indo-US Nuclear Contact Group in New Delhi, Vienna and London just ahead of US President Barack Obama's India visit, according to a PTI report.
"Based on these discussions, an understanding was reached with the US on the two outstanding issues on civil nuclear cooperation, which was confirmed by the leaders (Prime Minister Narendra Modi and Obama) on January 25, 2015," the ministry said in the release.
The MEA said that under Section 46 of the Civil Nuclear Liability Damage (CLND) Act, 2010, the operator of the nuclear plants is liable to pay compensation for the damages in case of a nuclear accident. However the operators can hold suppliers liable using Section 17 of CLND.
This section provides substantive right to the operator, who can use it as a provision in the contract with the supplier as a measure to share the compensation to be paid for the damages. However, this clause is not mandatory, it's up to the operator to use it.
"While it provides a substantive right to the operator, it is not a mandatory but an enabling provision... As a matter of policy, NPCIL (Nuclear Power Corporation of India Ltd.), which is a public sector undertaking, would insist that the nuclear supply contracts contain provisions that provide for a right of recourse consistent with CLND Rules of 2011," the release said.
The Indian government has set the insurance pool at ₹1,500 crores and "The government will indeed make available Rs 750 crores to the Insurance Pool for the first few years till the insurance companies are able to maintain it on their own".
There were questions raised on the extra prices that the taxpayers will have to pay in case of nuclear damages since the insurance pool will not be efficient enough to compensate for the damage to the nuclear plant, relocation, rehabilitation and environmental remediation.
"The researchers point out that the increased costs would be passed down to taxpayers and electricity ratepayers through increased tariffs. Belarus, which was worst hit by the Chernobyl disaster, has spent at least $235 billion over the last 30 years on relief, rehabilitation and clean-up. That is more than twice the size of the Indian nuclear market that American corporations are hoping to tap into," according to an earlier Scroll report.
However, the government believes that taxpayers will be devoid of any expenses caused by nuclear mishaps. "It should be understood that there is no extra burden on the taxpayer or the Government... The impact of the cost of power plants on the premium payments by operator and suppliers is expected to be minimal," the release said.