India's pact with US N-supplier may miss PM-Obama meeting deadline

Washington: A major pact between India's nuclear power corporation and American nuclear supplier Westinghouse for a power plant in Gujarat has failed to take off in time for Prime Minister Manmohan Singh's meeting with US President Barack Obama despite New Delhi's last minute push to close the deal.

Westinghouse is still waiting for clearances from the US Department of Commerce, say sources, which may delay the agreement on a 6600 megawatt plant in Gujarat which will run on American reactors.

The deal was cleared by the cabinet just before the Prime Minister left for his visit to the US for the UN General Assembly in New York.

Indian officials say the proposed deal between Westinghouse and the Nuclear Power Corporation of India would be the first time money is committed to a commercial US nuclear supplier since Dr Singh staked his government on a civil nuclear pact with the US five years ago.

It also comes at a time there is a raging debate over liability for foreign nuclear suppliers.

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US, Russian and French companies have been pressuring India to grant its companies greater protection from liabilities in case of a nuclear disaster. The opposition has accused the government of bending over backwards to accommodate foreign suppliers and water down the liability clause.

In case of the Westinghouse pact, the controversial question of liability will be dealt with later as it is a preliminary deal which does not involve putting in place nuclear equipment, say Indian officials.

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In 2010, Parliament passed the Civil Liability for Nuclear Damage Act, which creates a liability cap of Rs 1,500 crore for nuclear plant operators in case of an accident. If a foreign supplier's liability is limited, the Indian tax payer will have to pay in case of a nuclear accident like Fukushima in Japan, Russia's Chernobyl disaster or the Three-Mile Island accident in the US

Activists have challenged this in the Supreme Court, saying that nuclear operators and suppliers should be jointly and absolutely liable for civil damages in the event of an accident, and their financial liability must be unlimited.