India's Nuclear Energy Legislation and US-India Trade Relations

Commerce Minister Piyush Goyal emphasized India's focus on energy security, signaling significant US involvement in the future. He highlighted India's interest in US innovations in small modular reactors (SMRs) and mentioned ongoing cooperation in the nuclear energy sector. However, legal issues, particularly those related to liability concerns, need resolution to foster growth in nuclear energy collaboration between India and the US.

Amendments in Indian Nuclear Laws

• Civil Liability for Nuclear Damage Act, 2010 (CLNDA)
  • Amendments are underway to address liability concerns that deter foreign investment.
  • Key focus is on Section 17(b), which allows operators' right of recourse against suppliers.
  • This provision has been a barrier for foreign vendors like Westinghouse Electric and Framatome, who fear liability issues.
  • Efforts are being made to align Section 17 with international norms, ensuring clearer definitions of "suppliers" to exempt sub-suppliers from liability.
  • There is consideration to cap vendors' liability based on contract value and time frame.
• Atomic Energy Act, 1962
  • Proposed amendments aim to allow private and foreign companies to operate in India's nuclear power sector.
  • This would mark a significant shift from the current state-controlled operations.

Implications for Indo-US Relations

• The amendments could enhance the commercial potential of the Indo-US civil nuclear deal.
• Both legislations aim to align India with global nuclear liability frameworks like the 1997 Convention on Supplementary Compensation for Nuclear Damage (CSC).
• India's adherence to CSC provisions is crucial for progressing in trade negotiations with the US.

Regulatory Developments

• US Department of Energy (DoE) granted approval to Holtec International for technology transfer to India, easing previous regulatory restrictions.
• This authorization, known as '10CFR810', allows Holtec to involve Indian subsidiaries in SMR technology, facilitating Indo-US nuclear cooperation.

The legislative amendments and regulatory developments are essential to attract foreign investments and expand India's nuclear energy capabilities. However, building political consensus for these amendments remains a significant challenge in the Indian Parliament.