Indian Prime Minister Narendra Modi and U.S. President Barack Obama unveiled a plan centered on insurance that they hope will convince American companies to build nuclear power stations in India, but stopped short of demands to soften a liability law.
With the 1984 Bhopal gas tragedy still fresh in the mind of many Indians, that country’s parliament passed a law five years ago that makes equipment suppliers ultimately responsible for an accident, a deviation from international norms that the companies found hard to swallow.
According to Reuters, India's top diplomat, foreign secretary Sujatha Singh, said the new plan was squarely “within our law."
“We have reached an understanding,” she said at a media briefing. “The deal is done.”
It was in 1984 that U.S. company Union Carbide Corp's pesticide factory leaked gas, killing thousands. Activists are still seeking financial compensation and a clean-up of the site by parent Dow Chemical Co.
Indian and U.S. diplomats said the idea was to transfer the financial risk to insurers in case of an accident.
“The India nuclear insurance pool is a risk transfer mechanism which is being formed by GIC Re and four other public sector undertakings in the general insurance business in India,” foreign ministry joint secretary Amandeep Singh told Reuters.
After India and Washington first reached a nuclear deal in 2006, nuclear commerce worth billions of dollars was meant to be the centrepiece of a new strategic relationship, allowing New Delhi access to nuclear technology and fuel without giving up its weapons programme. But the liability issue blocked progress.
“We believe a sustainable solution is one that brings India into compliance with the International Convention on Supplementary Compensation,” said GE Hitachi Nuclear Energy in a statement.
Both GE and Westinghouse have already been given land in Gujarat and Andhra Pradesh to begin construction of reactors.
