India, Russia to sign pacts on Kudankulam III, IV reactors

India and Russia are involved in talks to sort out the nuclear liability issues before they sign an agreement for setting up Units III and IV of the Kudankulam power plant in Tamil Nadu during Prime Minister Manmohan Singh's annual summit with President Putin in Moscow next week.

During two-nation visit beginning Monday which will also take Singh to China, the likelihood of a Border Defence Cooperation Agreement (BDCA) to avoid face-offs between the two armies, especially against the backdrop of the Depsang valley incident this summer.

Incidentally, the Cabinet Committee on Security at its meeting today approved the BDCA.

"We are trying to do it. We hope we will do (the agreement on) three and four," official sources said on the likelihood of signing an agreement in regard to the two new reactors being set up in the Russian-aided project during Singh's visit.

Seeking to dismiss any major problems on the nuclear liability clause, an issue said to be nagging the Russians, the sources said the public-sector General Insurance Corporation (GIC) was working on issues relating to insurance and nuclear safety in view of the liability clause.

In view of the fact that a new area was being traversed, India itself was keen to sort out matters because of the nuclear liability act, government is the operator and it has to take a protective insurance cover that will cover the fault of suppliers, whether domestic or foreign, too.

"We have to see things mutually. We have told the Russians that we are the operators and they don't have the liability. The operator has the right of recourse. The liability clause is circumscribed by various conditions," the sources.

Anyway, they said, what the Russians need is a clear sense of what is involved because of the fear that the liability is unlimited, which is not.

The right to recourse of the operator will be in some cases against suppliers, both Indian and foreign. Then comes criminal aspect of any wilful action in creating accidents.
"For the Russians they need to know that there is a system that works," the sources said.

The GIC has a big task on hand because as it would have to engage experts to deal with the safety aspects of nuclear project in tune with the IAEA code. Because they will not know what is the worst case scenario in case of a failure of a bolt or a nut.

Apart from nuclear cooperation, the prime minister's visit is expected to cover the strategic partnership between the countries which is heavily political and military and less of economic.

But on the economic side, for the first time things are changing. Hydro carbons is an area in which the two countries are likely to make some progress.

In defence, there has been a deep engagement as India is working with them on production of the fifth generation fighter aircraft and multi-role transport aircraft.

The sources said Russians would be interested to know details of the explosion in the Russian-origin Kilo class submarine that sunk in Mumbai in August.

There is interest in India on the initiatives taken by Russia, of late, in regard to the middle east, especially on Syria and Iran and also Afghanistan.

On the China visit, the sources said Beijing wants a stable, strong and mutually beneficial relationship with India and both want peace and tranquillity on the border.

The prime minister will be hosted a dinner by the new President Xi Jinpeng, a rare gesture being made probably for the first time after what was offered to the late Pandit Jawaharlal Nehru in 1954.

Singh will have a meeting with his counter Li Keqiang when India is likely to talk about steps for additional Confidence Building Measures (CBMs) in place to maintain peace on the border.

"We want People's Liberation Army (PLA) to be involved in the process," the sources said.

On the boundary question, the two countries have agreed on a framework agreement which is a three-step progress. "We have made some progress on the framework agreement." Over time, India has agreed with China that respect of Line of Actual Control, status quo and mutually and equal security should govern the bilateral relations.

On water dispute, India believes that China was not impounding water in the Brahmaputra.

On the signing of the BDCA during the visit, the sources said "we are trying to get the agreement signed." The sources said the issue of stapled visas, especially in the context of the latest involving two archers from Arunachal Pradesh, will come up in the discussions between the two leaders.

"The fact is we don't like this (issue of stapled visas by Chinese to people of Jammu and Kashmir and Arunachal Pradesh. We are not going to accept," the sources said adding it would be conveyed to the Chinese side during the visit.

They said a proposed liberalised visa regime between the two countries is unlikely to be signed. The issue, which was to come up in the Cabinet meeting today, was deferred.

The sources said India was insisting on long term Chinese visas for Indian businessmen and professionals, including those from IT companies like TCS and Infosys on a reciprocal basis before it can be done by New Delhi.

There will also be economic content to the visit with India likely to urge for Chinese steps to correct the "huge imbalance" in the trade deficit New Delhi has.

While the prime minister is not expected to raise the issue of cross-border terrorism directed from Pakistan, the issue of Beijing's nuclear cooperation with Islamabad will figure in the discussions. "Our worry is what do they do with them (nuclear facilities).