Diluting N-liabality law for US: Ronen backs Vahanvati

Experts on Thursday sought to bail out attorney general GE Vahanvati, whose legal opinion on diluting the provisions of the nuclear liability law for the American companies ahead of prime minister Manmohan Singh’s visit to Washington has created a storm. Ambassador Ronen Sen, who was India’s ambassador to the US between 2004 and 2009 and architect of the Indo-US nuclear deal, wondered why similar hackles were not raised when the top legal officer gave a similar opinion to allow entry of Russian firms.

“These things become an issue only with the US. It is sad. We are always up in arms to protect our patriotism from an imaginary predatory force,” he told dna.

Vahanvati, in his opinion submitted to the department of atomic energy, has stated that it is up to the nuclear plant operator to invoke section 17 of the Act regarding the liability of suppliers in case of a mishap, paving the way for foreign suppliers to get away if a nuclear accident is traced to equipment or material they had supplied. The opposition parties, both the Left and the BJP, have blasted his opinion, saying it would repudiate the law as adopted by Parliament making the liabilities clear on foreign operators.

Sen said no other country in the world has this nuclear liability law. And a similar point was made by the attorney general last year for the Russian companies as well. “I wonder how issues become controversial only if they are related to the US,” he added. Further, India had prior international commitments with the US as well as with Russia even before enacting the liability law. “India had always adhered to the practice, as ingrained in the Vienna convention, that international agreements override domestic laws. But over the years, the practice, not only in the case of the US but for neighbouring countries like Bangladesh, is being violated,” he said.

India had taken a high pedestal position by blaming Americans for renouncing an international commitment, citing its domestic law while stopping fuel supply to Tarapur atomic power plant. The Americans had signed an agreement in 1963 pledging supply of nuclear fuel for Tarapur till 1993. In return, India agreed to maintain IAEA safeguards on the spent fuel. The US Congress, however, effectively nullified the provisions of the 1963 agreement, by a legislation it enacted in 1978, an Act re-enacted by the Indian Parliament in 2010.

“The liability law will hit not only foreign players, but the domestic ones as well.
Some 75-80% works and contracts would be manned by domestic players. We cannot make different laws. What about liability of domestic players?” asked Ronen Sen.

The indecisions, unpredictability, lack of transparency and a host of other factors such as imposing retrospective taxation and issues in telecom have affected the confidence and sentiments in the US, which has also given up hope to balance Asia by propping up India to counter China. Off late, the US has moved to Asia-pacific relying on Japan, Vietnam and Indonesia to balance powers in Asia.

As against India’s indecision, China tied up with the same US company in 2007, and by now every equipment is in place. 

Reports said the  Cabinet committee on security was mulling over signing an agreement between Nuclear Power Corporation of India Ltd and the US-based Westinghouse Electric Company. The US sees the liability law as a hurdle in selling nuclear reactors to India. But in an opinion, Vahanvati is learnt to have paved the way.