In a detailed "frequently asked questions" on the civil liability law and related issues, the statement by the External Affairs Ministry also states that operator of the nuclear installation shall be liable for nuclear damage caused by nuclear incident.

It also says that the liability of the operator shall be strict and shall be based on the principle of no fault liability. The operator shall also take out an insurance policy covering his liability. But the operator, after paying compensation for nuclear damage can have right to recourse in cases where the nuclear incident is due to the supplier, including defective or sub-standard services or where it is with an intent to cause nuclear damage.



It says after discussions between both sides they arrived at an understanding that India's Civil Liability for Nuclear Damage (CLND) Act is compatible with the Convention on Supplementary Compensation for Nuclear Damage (CSC), which India has signed and intends to ratify.

There is no proposal to amend the civil liability act or the rules, it said, adding: "India Nuclear Insurance Pool has been instituted to facilitate negotiations between the operator and the supplier concerning a right of recourse by providing a source of funds through a market based mechanism to compensate third parties for nuclear damage. It would enable the suppliers to seek insurance to cover the risk of invocation of recourse against them".

On the India Nuclear Insurance Pool, it says it is "a risk transfer mechanism formed by GIC Re and four other PSUs who will together contribute a capacity of Rs.750 crores out of a total of Rs.1,500 crore."

The balance would be contributed by the government. Through this mechanism, "operators and suppliers instead of seeing each other as litigating adversaries will see each other as partners managing a risk together. This is as important for Indian suppliers as it is for US or other suppliers.

An international workshop will be held in India to exchange information on international experience with the 26 insurance pools operating around the world in countries such as France, Russia, South Africa and the US," it said.

On the way forward it said it is now "up to the companies to follow up with their own negotiations and come up with viable techno-commercial offers and contracts consistent with our law and our practice so that reactors built with international collaboration can start contributing to strengthening India's energy security and India's clean energy options".

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