Draft deal for new KNPP units ready

Moscow and New Delhi are close to resolving the impasse over applicability of India’s liability law on the new reactors proposed to be supplied by Russia for the third and fourth units of the Kudankulam Nuclear Power Project (KNPP) in Tamil Nadu.

Sergey Kirienko, the Director General of Russia’s state-owned nuclear company Rosatom, was in New Delhi on Monday. He had a meeting with top officials of the Nuclear Power Corporation of India Limited to draft a text of the proposed techno-commercial agreement for KNPP's third and fourth units. A final decision on the draft will be taken when External Affairs Minister Salman Khurshid and Russian Deputy Prime Minister Dmitry Rogozin meet in New Delhi on Wednesday.

Sources told Deccan Herald that New Delhi and Moscow were making efforts to narrow their differences on the draft agreement, which sought reconciliation between the stringent Civil Liability for Nuclear Damage Act of India and the international legal regime for fixing liability for mishaps or other unwanted incidents in atomic power plants.

The agreement’s draft text addresses Russia’s concerns over applicability of India’s nuclear liability law on KNPP's new units. New Delhi, however, is understood to be also keen to ensure that nuclear companies of the United States and France cannot cite it as a precedence to seek similar arrangement for atomic power plants they set up in India.

Moscow and New Delhi, on July 17, 2012, inked a protocol on the new units of the KNPP, with Russia agreeing to provide India with a state credit of $3.4 billion for work, supplies and services for construction of the new reactors and related fuel supplies.

The negotiation on the techno-commercial deal for the new reactors hit a roadblock when Russia argued that India’s Civil Liability for Nuclear Damage Act would not apply on the new reactors to be installed at the plant. Moscow pointed out that India had no legal regime for nuclear liability when the intergovernmental agreement for cooperation in atomic power generation was first signed in 1988. It claimed that the two new reactors it would supply were continuation of the partnership agreed upon in 1988.

Russia also argued that the two countries also signed agreements on nuclear cooperation in 2008 and 2010, much before India’s liability law came into effect in 2011.