Centre now wary of capping compensation liability of foreign firms at Rs500 crore
The Bhopal gas tragedy judgment has come as a huge embarrassment for the UPA government, which prides itself on batting for the aam admi. Responding to the public outrage after the verdict was announced, law minister M Veerappa Moily even hinted at bringing in legislation to fast-track “justice”.
He also indicated a move that is likely to impact India-US diplomacy. Moily, soon after the Bhopal judgment, said the Civil Liability for Nuclear Damage Bill, pending in Parliament, requires a re-look. “This is a serious matter and involves lives. There are issues related to the payment of compensation, and the quantum of compensation as well,” he said. It seems certain, in the backdrop of the Bhopal case, that the nuclear liability cap of Rs500 crore in the draft bill will have to be raised substantially if it has to be approved.
Moily felt offences should be investigated better and punitive measures clearly defined so that everyone is well aware of them. “This difference between the first world and the third world when it comes to treating human lives has to go,” he said.
Yet, this is easier said than done. For instance, in the Bhopal case, Union Carbide Corporation and the Government of India settled for $470 million in 1989 as compensation (worth about Rs799 crore then). Now the US is pushing India to pass the nuclear liability bill with a cap of Rs500 crore (just over $1 million) as compensation before American firms enter the lucrative civilian nuclear market here.
But when it comes to compensation for its own citizens, the US has a different view. For the recent oil spill off four American coastal states, Washington is asking British Petroleum (BP) to start by paying $69 million for the clean-up and to pay each affected person $5,000.
The total compensation might run into billions of dollars. BP has so far paid $84 million for loss of income to those living in the affected states of Louisiana, Mississippi, Alabama and Florida.
The much-documented dispute on the nuclear liability bill is over the compensation cap of Rs500 crore on foreign firms operating in India in case of an accident. The overall liability cap is pegged at Rs2,200 crore; the difference is to be paid by the government. Opposition parties and activists have opposed the cap, saying the entire compensation should be paid by the firm and the amount should be left open-ended, as is the case with many countries.
There is immense pressure on the government to quickly pass the legislation, without which US nuclear companies cannot get a piece of the over $200-billion Indian civilian nuclear energy market.
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