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Nuclear Liability Issue Between The United States And India

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Akshay Shankar Bharadwaj
A53048067
IRGN 490 – ENERGY DIPLOMACY
Professor Julia Nesheiwat
Executive Summary
This analysis paper will discuss the following key research questions –
“What is the current status of the nuclear liability issue between the United States and India? Based on this deal, what are the implications on India’s energy mix? ”
This paper will address the civil nuclear liability issue and it will also shed light on the implications for nuclear energy on India 's current energy mix and its future as well. I will explain the incentives for both nations to go forward with this deal and the role played by other foreign nuclear suppliers. Furthermore, this paper shall also discuss the potential risks and commitment issues from …show more content…

The liability issue was introduced to the Indian Parliament by invoking the horror of the Union Carbide Bhopal Gas tragedy incident where a gas leak from the Union Carbide operated pesticide plant resulted in the death of thousands of civilians. The CLNDA 2010 has a simple purpose in that, it makes sure the victims of a nuclear accident can receive quick compensation, without having to prove that the plant operator is negligent irrespective of who is at fault.
In light of President Barack Obama’s landmark visit to India this year, the two nations reached a tentative agreement regarding the nuclear liability issue in terms of shared risk and U.S tracking of nuclear material. The main idea was to transfer the financial risk to the insurers in case of an accident.
The US- India civil nuclear deal (123 Agreement) had been stalemated for several years on 2 counts-
1) The Liability clause that the US companies (GE and Westinghouse) saw as affecting their profitability- the compromise worked out is the creation of some kind of an insurance pool. Under this workaround, an Indian state run insurance company GIC Re will contribute $122 million to the insurance pool with the balance being covered by the Indian Government.
2) The US insistence on tracking the movement of nuclear fuel from third country sources- this has now been addressed by the US letting go of this demand and both countries agreeing to

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