India ratified Convention on Supplementary Compensation for Nuclear Damage

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Who: Convention on Supplementary Compensation for Nuclear Damage
What: Ratified by India
When: 3 February 2016

India on 4 February 2016 submitted its Instrument of Ratification of the Convention of Supplementary Compensation for Nuclear Damage (CSC), 1997 to International Atomic Energy Agency (IAEA) at Vienna, Austria.

The instrument is an important multilateral treaty relating to liability and compensation for damage caused by a nuclear incident.

The instrument of Ratification was handed over to Juan Carlos Lentijo, Acting Director General of IAEA by India’s Permanent Representative in Vienna Rajiva Misra. The CSC was ratified five years after it was signed on 27 October 2010.

The Convention will come into force for India on 4 May 2016 because as per law, the convention comes into force after 90 days of submission of ratification.

Why the need to submit the instrument of ratification of CSC?
Certain clauses, especially Section 17(b) and Section 46 under India’s Civil Liability Nuclear Damage Act, 2010 were major impediments in the progress of building reactors with the help of the established firms of the US as well as France and Russia in India.

The clause Section 17(b) relates to the Right of Recourse and Section 46 deals with potential claims against the supplier of nuclear equipment.

These clauses made equipment suppliers like General Electric potentially accountable for accidents, not just the plant operators as is the global norm.

Advantages to India
However, with India submitting the instrument of ratification, the following advantages are expected:
• It will help establish a worldwide liability regime and to increase the amount of compensation available to the victims of nuclear accidents.
• It will help India in addressing the concerns of foreign nuclear suppliers over civil nuclear liability in India, although in 2015 India launched an insurance pool with a liability cap of 15 billion Indian rupees (225 million dollars) to cover the suppliers’ risk of potential liability
• It will help in drawing the foreign nuclear suppliers to Indian nuclear market which is worth billions of dollars.
• It will help India achieving the objective of increasing the share of nuclear power from barely 3 percent to 25 percent by 2050.
• It will give India access to international funding, beyond those available through national resources, to pay for damages in the event of a nuclear accident.

India’s interaction with nuclear suppliers
India plans to construct about 60 nuclear reactors and has been in talks with Westinghouse Electric Co LLC, GE as well as France’s Areva for setting them up at sites already selected around the country.

Russia is separately building six reactors in south India and is in talks for another six. The total size of the Indian market is estimated at 150 billion dollars making it equal to or just behind China’s.

About Convention of Supplementary Compensation for Nuclear Damage (CSC)
• The CSC was adopted on 12 September 1997, together with the Protocol to Amend the Vienna Convention on Civil Liability for Nuclear Damage, and entered into force on 15 April 2015.
• It aims at increasing the amount of compensation available in the event of a nuclear incident through public funds to be made available by the Contracting Parties on the basis of their installed nuclear capacity and UN rate of assessment.
• It also aims at establishing treaty relations among States that belong to the Vienna Convention on Civil Liability for Nuclear Damage, the Paris Convention on Third Party Liability in the Field of Nuclear Energy or neither of them.
• It leaves intact the 1988 Joint Protocol that establishes treaty relations among States that belong to the Vienna Convention or the Paris Convention.