Delhi bill paves way for nuclear development

Despite protests from environmental groups, the government says nuclear energy is "vital" to support the nation of 1.2 billion people.

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MUMBAI // The passage of a controversial nuclear bill could ease India's vast energy shortfall and end its lowly status in the global nuclear marketplace, Indian officials say. "I categorically state that this bill is a completion of [the] journey to end the nuclear apartheid which the world had imposed on India," Mr Singh told parliament during a fiery four hour debate before lawmakers voted on the legislation.

The Civil Nuclear Liability Bill, which was passed on Wednesday by the lower house of parliament after months of bitter political wrangling, paves the way for nuclear commerce worth US$150 billion (Dh551bn) with foreign companies. Despite protests by opposition parties and environmental groups, the government says that nuclear power is badly needed in this energy-starved country of 1.2 billion people. "Uranium-based nuclear energy is vital for us," Prithviraj Chauhan, the minister of science and technology, said during the debate.

Manish Tiwari, a spokesman for India's ruling Congress party, added: "India's future generations will, hopefully, not have to face a shortfall of electricity." India currently accounts for 3.4 per cent of the global energy consumption, making it the world's sixth-largest energy consumer. With India's economic boom, the demand for energy has surged at a rate of nearly four per cent in the last 30 years, according to India's power ministry.

Despite an ambitious rural power programme, about 600 million Indians still have no access to electricity. While 80 per cent of Indian villages have at least an electricity line, just 44 per cent of rural households have access to electricity. The country's annual power production climbed to 680 billion kilowatt hours (kwh) in 2006 from just 190 billion kwh two decades ago. But demand far outstrips supply. The total demand for electricity is expected to surpass 950,000 megawatts by 2030.

In 2008, Mr Singh and the former US president George W Bush signed the landmark Indo-US nuclear accord, a bilateral agreement on atomic power co-operation for civilian purposes. It gave India access to American technology and fuel, and reversed a three-decade global ban on nuclear trade with the country, imposed after it first conducted an atomic test in 1974. The nuclear liability bill was the final crucial piece of legislation needed to formally put the 2008 accord into operation, but since it was first introduced in parliament in April, the bill faced stiff resistance from opposition parties, many of which were against giving foreign suppliers unbridled access to India's lucrative nuclear market.

The US government has for months been lobbying the Indian government for the legislation to be passed, which would allow American nuclear plant manufacturers such as General Electric and Westinghouse to penetrate the Indian market. The resistance grew stronger after seven men were sentenced to just two years in prison in June over their roles in the Bhopal gas disaster - India's worst industrial disaster. The sentences caused anger among survivors and the relatives of those who perished. The poisonous fumes that leaked in 1984 from the Union Carbide chemical factory in Bhopal killed 20,000 and crippled 100,000.

Greenpeace India, an environmental group, decried the court ruling and criticised the government for treating "industrial genocide the same [way] as street crime". Many contended that foreign nuclear suppliers, in much the same way, would get away with insufficient compensation in the event of a nuclear disaster. Greenpeace argued that the nuclear liability bill was a "recipe for many Bhopals". When presented initially in April, the nuclear liability bill sought to cap maximum liability of about 5bn rupees (Dh392million) on the operator of the nuclear plant if there were an accident. But opponents of the bill claimed this was insufficient. They also cried foul about a clause in the bill which would hold the operator liable for damages only if it was discovered that there was an "intent" on its part to cause damage.

The government tried to assuage these concerns by introducing as many as 18 amendments in the new draft of the bill tabled this week. Most notably, it trebled the compensation cap to be paid by the operator to 15bn rupees. Mr Chauhan clarified to parliament on Wednesday that this was not the final "limit", and was meant only to enable plant operators to seek insurance cover. The overall compensation, he said was "unlimited" and would be decided as per the extent of the damage by the government-appointed claims commissioner.

Mr Chauhan also purged the word "intent" from the contentious clause. But the tougher accident liability provisions and higher compensation could impede the growth of the nuclear industry, warns the Confederation of Indian Industry, a lobby of manufacturing businesses. "Globally, there is no insurance coverage available for suppliers in the nuclear business," the loby wrote in a letter this week to the government. "This will stall the growth of the nuclear manufacturing industry in India and be a setback for the government's plan to indigenise maximum supplies for the foreign technology plants."

But the government ruled out possibilities of lowering the compensation cap.