Why in the News?

India is thinking about changing the Civil Liability for Nuclear Damages Act, 2010, and the Atomic Energy Act, 1962. These changes would let private companies build and run nuclear power plants.

What are the concerns about foreign investment and liability?

• Foreign Companies Fear Being Blamed After Accidents: They worry they’ll be held legally responsible if something goes wrong, which could cost them a lot of money. Eg: U.S. company Westinghouse and French company Areva stayed away from India’s nuclear sector due to strict liability laws.
• Indian Law Puts All Blame on the Operator: India’s current law makes the plant operator fully responsible, even if the equipment from foreign suppliers fails. Eg: If a part made by a foreign company causes a problem, only NPCIL (Indian operator) is blamed and has to pay.
• Old Accidents Still Raise Worries: Events like the Bhopal Gas Tragedy make people cautious about giving foreign companies a free pass on liability. Eg: In 2012, the NDA opposed changes in law that would reduce foreign companies’ responsibility, citing past disasters.

How will the amendments help achieve 100 GW capacity?

• Enabling Foreign Participation: Amendments will remove liability-related hurdles, allowing global firms to invest and supply technology. Eg: Westinghouse (U.S.) and EDF (France) may enter Indian projects if liability norms align with international standards.
• Boosting Domestic-Private Sector Involvement: Changes in laws like the Atomic Energy Act could allow Indian private companies to build and operate reactors. Eg: Companies like L&T and BHEL may contribute to infrastructure and component manufacturing at scale.
• Attracting Investment in Advanced Reactors (SMRs): Legal clarity could attract funds and partnerships in Small Modular Reactors, helping scale capacity rapidly. Eg: New-age firms working on SMRs may partner with India if assured of returns and limited liability.

What challenges exist in small modular reactor (SMR) technology transfer?

• Profit-Driven Technology Sharing: Private foreign firms transfer technology only if it’s commercially viable, not for strategic or public interest reasons. Eg: U.S. companies will share SMR tech only if returns outweigh security or IP risks.
• Restrictions by National Governments: Export controls and national security concerns limit what tech can be transferred internationally. Eg: The U.S. government regulates tech transfers; past transfers to China (like AP1000) led to cloning and IP misuse.
• Partial Transfers and Proprietary Control: Even friendly countries often retain core tech and allow only partial local production. Eg: Russia’s Rosatom allowed India to build sub-components of VVER reactors but kept control over critical hot sections.

Why is the Convention on Supplementary Compensation (CSC) important for nuclear compensation?

• Ensures Quick Compensation Without Legal Delays: CSC focuses on giving fast financial help to victims of nuclear accidents without long court cases. Eg: After a nuclear incident, funds can be released immediately to affected people, unlike long litigation seen in Bhopal.
• Fixes Responsibility on the Operator Only: CSC channels all liability to the nuclear plant operator, protecting suppliers unless there’s proven misconduct. Eg: If NPCIL runs the plant, it bears full responsibility, not companies like Westinghouse or Rosatom.
• Creates an International Compensation Fund: It sets up a multi-tiered fund (including global contributions) to support countries during large-scale accidents. Eg: A country can access a global pool of money through CSC if the cost of a disaster exceeds national capacity.

Way forward: 

• Strengthen Legal Framework to Balance Liability and Investment: Amend India’s nuclear laws to align liability rules with international standards like the CSC, ensuring fair responsibility for operators while providing enough protection to attract foreign and private investments.
• Promote Technology Transfer and Domestic Capacity Building: Create transparent policies and incentives that encourage foreign companies to share advanced nuclear technologies such as Small Modular Reactors (SMRs) with Indian firms, while simultaneously building India’s own manufacturing and operational capabilities to achieve energy targets sustainably.

Mains PYQ:

[UPSC 2018] With growing energy needs should India keep on expanding its nuclear energy programme? Discuss the facts and fears associated with nuclear energy.

Linkage: The article  indicate that discussions are ongoing in India to amend its nuclear liability framework (specifically, the Civil Liability for Nuclear Damages Act (CLNDA), 2010, and the Atomic Energy Act (AEA), 1962). The primary reason for these proposed amendments is to allow private companies to build and operate nuclear energy-generation facilities and to expand India’s nuclear energy capacity from 8 GW to 100 GW by 2047, aligning with the country’s clean energy goals.

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