For almost two weeks prior to president Barack Obama’s visit to India, the negotiators from both the countries had been burning the midnight oil to operationalise Indo-US nuclear cooperation but hurdles seem to be emerging one after another. The first and the most talked about hurdle arose from Section 17 (b) of the Civil Liability for Nuclear Damage Act 2010, giving the right of recourse to the operator of the nuclear installation if nuclear incident resulted as a consequence of an act of the supplier or his employee which includes supply of equipment or material with patent or latent defects or sub-standard services. This provision was introduced to ensure that the suppliers took utmost care since they would be liable even for “latent” defects that may exhibit their appearance in their equipment later on after extended exposure to nuclear related stresses. This problem seems to have been solved by India’s proposal for an insurance cover of `1500 crore out of which 50 per cent would be government contribution and the remaining from a pool of insurance companies which are public sector units. Oddly, it would mean victims compensating victims.
The next conflict has arisen in respect of Section 46 of the Act which provides that its provisions shall be in addition to and not in derogation of any other law for the time being in force. It further provides that nothing contained in this Act shall exempt the operator from any proceeding which might, apart from this Act, be instituted against such operator or the suppliers directly or through the operator. The victims of nuclear incidents are thus entitled to file tort suits for unlimited damages and even criminal proceedings against the operator as well as suppliers. This is perceived as a double jeopardy. It has been claimed that during the Obama-Modi “chai pe charcha” on January 25, some “understanding” has been reached but details are not disclosed. Considering that the nuclear liability law of India was passed by Parliament, it would be interesting to know how the provisions of Section 46 have been circumvented without amending the law.
The next deadlock was the demand of the US negotiators for full lifetime flagging and tracking of the equipment and materials supplied by US companies used in nuclear reactors set up by American companies and others as well. India held this demand to be unnecessary and superfluous since all Indian civil nuclear facilities are already adequately covered under IAEA (International Atomic Energy Agency) Safeguards and the Additional Protocol.
Furthermore, such a demand is highly intrusive and unacceptable in view of the fact that India is likely to import only nuclear fuel from many other countries like Australia and Kazakhstan which are already under international inspection by the IAEA. It is reported by the Indian Press that at the “chai pe charcha”, the US president agreed to get the “flag and track” clause deleted by using his executive powers. Surprisingly, Obama had to use his executive powers to delete a clause in a document which was still being negotiated.
The “flag and track” clause was incorporated actually to facilitate implementation of the Hyde Act 2006. It is time to recollect that India is not a signatory to the NPT (Non-Proliferation Treaty) and the US Atomic Energy Act 1954 strictly forbids nuclear trade with any such country. Under the then politically pressing circumstances warranting Indo-US cooperation in nuclear energy, an exemption to the above restriction had to be granted. Consequently, the Henry J Hyde US-India Peaceful Atomic Energy Act 2006 was passed by the US Congress on December 18, 2006. This is a unique legislation specific to India whereby the US president was enabled to negotiate nuclear cooperation with a non-NPT country. The events that followed are still fresh in memory. The 123 Indo-US Civil Nuclear Agreement of 2008 was hailed as an achievement in the US but it was touted as pro-America and anti-India. It was passed by the Indian parliament by a thin majority with accusations of bribes and corruption.
The US demand for “flagging and tracking” emanates from Article 104 of the Hyde Act 2006. It specifically mandates that the US president shall submit to the Congress an analysis of whether American cooperation is in any way assisting India’s nuclear weapons programme through the use of any US equipment, technology or material in an unsafeguarded nuclear facility or in any other nuclear weapons related complex. It is a requirement of US law and the negotiators will now have to find some other way to achieve this objective if the “flag and track” is deleted.
The story does not end here. There is still some more to come. Under the Hyde Act, the US president is further required to submit to an appropriate Congressional committee any significant changes in the nuclear activities of India including construction of nuclear facilities, production of nuclear weapons or changes in nature and amount of fissile material produced and the purpose and operational status of any unsafeguarded new nuclear facility. Still further under the Hyde Act, the US president shall have to inform the Congress an estimate of the amount of uranium mined and milled in India and amount of such uranium that has likely been used or allocated for weapons; the rate of production of nuclear devices and the material used therein. Some procedure will have to be worked out in the administrative arrangements to achieve this objective and procure such information on India’s non-civilian nuclear activities for information to the US Congress. In view of these requirements, the Indian negotiators are likely to face still tougher uphill tasks ahead.
The author is a practising lawyer and a retired scientist formerly with BARC, Mumbai, and IAEA, Vienna.
Email:drbbsingh2010@gmail.com