Russia, India Hammer Out Nuclear Liability Compromise, with Up to 16 Projects at Stake

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Officials from the Nuclear Power Corporation of India (NPCIL) (Mumbai) and Rosatom (Moscow), Russia's state-owned nuclear agency, have been holding talks in Mumbai with a view to signing contracts for the third and fourth reactors for the Kudankulam nuclear power plant. The parties hope to sign the agreement before national elections are held.

Negotiations have been deadlocked for months over a penal law, which covers responsibilities over nuclear accidents. The chief of Rosatom was in Delhi last week for a few hours to hold negotiations on the issue.

Russia and the U.S. are concerned about India's nuclear liability law. The law makes suppliers of nuclear fuel and related equipment liable in case of a nuclear plant accident. Differences over this issue prevented the signing of contracts in the last moments of Prime Minister Manmohan Singh's visit to Moscow in October 2013.

A great deal is at stake, now and in the future for both sides, as they work to reach a compromise. If the deal is signed, it will expand Rosatom's presence in the Kudankulam project as decided in 2010, when Russia and India signed a roadmap, which included the construction of up to 16 nuclear power projects in India.

The Russians already have set up two 1,000-megawatt (MW) reactors at Kudankulam, and NPCIL is developing the power generation output, with the first unit due to begin commercial operations in April and the second by December. Commercial operation of the two units was delayed by protests from non-governmental organizations (NGOs). Russia could supply four more reactors to the project, making a total of eight.

Rosatom is considering India's offer for insurance coverage through its state-owned General Insurance Corporation (GIC). This would allow suppliers to know exactly how much they would be liable to pay in the event of a nuclear accident, but could still approach any other insurance company, including a Russian one. GIC would offer insurance rates for different components of the Russian reactors. This could increase the cost of the reactors. But if there were no insurance claims, the Russian suppliers would have their money returned at the end of the insurance period.

For related information, see October 24, 2013, article - Kudankulam Nuclear Plant Powers Up After Six-Year Delay.

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