{"id":65470,"date":"2025-09-28T12:26:38","date_gmt":"2025-09-28T06:56:38","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=65470"},"modified":"2025-09-29T17:34:44","modified_gmt":"2025-09-29T12:04:44","slug":"india-us-nuclear-energy-talks-face-hurdles-over-liability-laws","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/india-us-nuclear-energy-talks-face-hurdles-over-liability-laws\/","title":{"rendered":"India-US Nuclear Energy Talks Face Hurdles Over Liability Laws"},"content":{"rendered":"<h2><b>India-US Nuclear Deal Latest News<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">During renewed trade negotiations in New York, Commerce Minister <\/span><b>Piyush Goyal<\/b><span style=\"font-weight: 400;\"> highlighted India\u2019s energy security vision, which will involve strong collaboration with the <\/span><b>United States<\/b><span style=\"font-weight: 400;\">, especially in <\/span><b>small modular reactor (SMR) technologies<\/b><span style=\"font-weight: 400;\"> and broader nuclear energy cooperation.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, progress faces hurdles due to <\/span><b>unresolved legal issues<\/b><span style=\"font-weight: 400;\">, particularly India\u2019s nuclear liability framework, which has long discouraged US firms from entering the Indian nuclear market.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Addressing these liability concerns is essential but remains a complex challenge, making expansion in nuclear cooperation easier said than done.<\/span><\/li>\n<\/ul>\n<h2><b>US Regulatory Clearance Boosts Indo-US Nuclear Prospects<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In March, the US Department of Energy (DoE) granted <\/span><b>Holtec International regulatory clearance under the restrictive 10CFR810 rule<\/b><span style=\"font-weight: 400;\">, a long-standing hurdle in Indo-US nuclear cooperation.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The approval conditionally permits Holtec to transfer unclassified small modular reactor (SMR) technology to its subsidiary Holtec Asia, as well as Indian firms Tata Consulting Engineers and Larsen &amp; Toubro.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Previously, 10CFR810 regulations barred US companies from manufacturing nuclear equipment or conducting nuclear design work in India, blocking New Delhi\u2019s aim to co-produce SMRs for domestic needs.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The clearance removes this roadblock, paving the way for collaboration.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Now, the onus shifts to India, which must pass pending legislative amendments \u2014 particularly to its liability law and the Atomic Energy Act \u2014 to unlock foreign investment.<\/span><\/li>\n<\/ul>\n<h2><b>Key Amendments to India\u2019s Nuclear Liability Framework<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India is working on a set of 11 amendments to its Civil Liability for Nuclear Damage Act, 2010 (CLNDA) to attract foreign investment and ease vendor concerns.<\/span><\/li>\n<\/ul>\n<h3><b>Section 17(b) \u2013 The Main Obstacle<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Section 17 of CLNDA allows <\/span><b>nuclear plant operators to seek compensation from suppliers after paying damages for an accident<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Specifically, Section 17(b) gives <\/span><b>operators a \u201cright of recourse\u201d<\/b><span style=\"font-weight: 400;\"> if an incident results from defective or substandard equipment supplied.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Foreign vendors like Westinghouse Electric (US) and Framatome (France) argue this provision is stricter than global norms, exposing them to unlimited liability.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Since its enactment, no foreign company has invested in India\u2019s nuclear projects, fearing financial risks.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Even domestic sub-suppliers like L&amp;T and Walchandnagar Industries are wary, as the term \u201csupplier\u201d is too broad and could include small vendors.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><b>Proposed Amendments<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The government is considering:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><b>Diluting Section 17(b)<\/b><span style=\"font-weight: 400;\"> to bring it in line with international nuclear liability laws.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Clarifying the <\/span><b>definition of \u201csupplier<\/b><span style=\"font-weight: 400;\">\u201d to exclude sub-suppliers from automatic liability.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><b>Capping vendor liability<\/b><span style=\"font-weight: 400;\">, both in monetary terms (limited to contract value) and by time frame, so risks do not extend indefinitely.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><b>Regulatory Safeguards<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Officials note that the Atomic Energy Regulatory Board (AERB) already vets all projects and can ensure right of recourse is explicitly written into contracts.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">This safeguard could balance accountability while easing investor fears.<\/span><\/li>\n<\/ul>\n<h2><b>Opening India\u2019s Nuclear Sector to Private Participation<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India is preparing <\/span><b>sweeping reforms<\/b><span style=\"font-weight: 400;\"> to allow private and potentially foreign companies to participate in nuclear power generation \u2014 a sector long reserved for state-owned operators.\u00a0<\/span><\/li>\n<\/ul>\n<h3><b>Amendment to the Atomic Energy Act, 1962<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The government plans to amend the Atomic Energy Act, 1962, which currently restricts nuclear plant operations to public sector entities like NPCIL and NTPC Ltd.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The proposed reform would:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Enable private firms to enter nuclear power generation.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Allow for minority equity stakes by foreign companies in upcoming nuclear projects at a later stage.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Expand the sector\u2019s capacity by leveraging private investment and technology.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><b>Link to Indo-US Civil Nuclear Deal<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Nearly two decades after the Indo-US civil nuclear agreement, these reforms are seen as crucial to unlocking its commercial potential.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">New Delhi also hopes to present this move as part of its broader trade and investment partnership with Washington, complementing ongoing India\u2013US trade negotiations.<\/span><\/li>\n<\/ul>\n<h2><b>Aligning India\u2019s Nuclear Laws with Global Norms<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India is moving to amend its <\/span><b>Civil Liability for Nuclear Damage Act (CLNDA)<\/b><span style=\"font-weight: 400;\"> to align more closely with the <\/span><b>1997 Convention on Supplementary Compensation for Nuclear Damage (CSC)<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">These changes are aimed at easing investor concerns, clarifying ambiguities, and bringing India fully into the global nuclear liability regime.<\/span><\/li>\n<\/ul>\n<h3><b>Compliance with the CSC<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India signed the CSC in 2010 and ratified it in 2016, despite <\/span><b>not being a member of the Vienna (1963) or Paris (1960) Conventions<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The proposed amendments to CLNDA will:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Harmonise India\u2019s framework with CSC provisions and annexures.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Strengthen India\u2019s standing as a CSC-compliant state party, ensuring compatibility with international liability norms.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><b>Clarification of \u201cSupplier\u201d<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A major issue has been ambiguity in the definition of \u201csupplier\u201d under <\/span><b>Rule 24 of CLND Rules<\/b><span style=\"font-weight: 400;\">. The rules state a supplier may include:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">A manufacturer providing systems, equipment, or structures.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">A vendor responsible for design and quality assurance.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Providers of quality assurance or design services.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, uncertainty remains on whether this applies only to <\/span><b>reactor suppliers like Westinghouse<\/b><span style=\"font-weight: 400;\"> or also to <\/span><b>small vendors<\/b><span style=\"font-weight: 400;\">, such as an electrical package provider in a Rs 1 crore contract.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The amendments seek to <\/span><b>clearly define supplier responsibilities<\/b><span style=\"font-weight: 400;\">, easing fears of unlimited liability for smaller sub-vendors.<\/span><\/li>\n<\/ul>\n<h2><b>Conclusion<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">These amendments are an <\/span><b>economic necessity<\/b><span style=\"font-weight: 400;\"> to attract foreign and domestic investment into India\u2019s nuclear sector.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Still, the <\/span><b>biggest challenge<\/b><span style=\"font-weight: 400;\"> will be forging <\/span><b>political consensus<\/b><span style=\"font-weight: 400;\"> in Parliament to pass the reforms, which may now be delayed beyond the monsoon session.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Source: <\/span><a href=\"https:\/\/indianexpress.com\/article\/explained\/india-legal-issues-n-power-us-negotiations-10270208\/\" target=\"_blank\" rel=\"nofollow noopener\"><span style=\"font-weight: 400;\">IE<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India\u2019s nuclear reforms aim to attract US investment, but liability laws, political opposition &#038; supplier concerns make Indo-US nuclear cooperation challenging.<\/p>\n","protected":false},"author":18,"featured_media":65611,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[2943,60,22,59],"class_list":{"0":"post-65470","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-india-us-nuclear-deal","9":"tag-mains-articles","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-affairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/65470","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=65470"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/65470\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/65611"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=65470"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=65470"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=65470"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}