Daily Mains Question - GS 2 - 12th July 2025

Welcome to your daily Mains Model Answer — designed to deepen your understanding of India’s civil nuclear liability framework and its evolving role in shaping international cooperation, a key theme within GS Paper 2 under International Relations and Governance. Today’s answer explores how legal reforms in the atomic energy sector aim to harmonise domestic laws with global norms, thereby enabling foreign investment and technological collaboration.

This topic intersects crucial domains such as energy security, international law, environmental sustainability, and strategic diplomacy. It also aligns with India’s commitments to clean energy transitions, multilateral nuclear conventions, and efforts to position itself as a responsible global nuclear power.

By examining key statutory changes proposed to the Civil Liability for Nuclear Damage Act, 2010 and the Atomic Energy Act, 1962, this model answer highlights how legal alignment with the Convention on Supplementary Compensation (CSC) could unlock stalled international partnerships. Aspirants will gain insights into the interplay between domestic legal structures and international confidence-building, enhancing their ability to craft analytically rich and policy-oriented responses in the UPSC Mains examination.

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QUESTION

Discuss the role of legal reforms in India’s civil nuclear liability framework in facilitating international cooperation in the nuclear energy sector.

Answer: India’s civil nuclear liability framework has long been a subject of debate due to its deviation from international norms, particularly concerning supplier liability. As India seeks to enhance energy security and transition to clean energy sources, aligning its nuclear liability laws with global standards is critical to attracting foreign investment and fostering international cooperation in the nuclear energy sector. Recent legal reform proposals, particularly those amending the Civil Liability for Nuclear Damage Act (CLNDA), 2010 and the Atomic Energy Act, 1962, aim to address longstanding investor concerns and facilitate India's deeper integration into the global civil nuclear regime.

India’s Civil Nuclear Liability Framework

• Civil Liability for Nuclear Damage Act (CLNDA), 2010 was enacted to provide a mechanism for compensation to victims in the event of a nuclear accident.

• The law established strict and no-fault liability on the operator and created a right of recourse against suppliers under certain conditions (Section 17).

• India is a party to the Convention on Supplementary Compensation (CSC), 1997, which seeks to harmonize international nuclear liability norms. India signed it in 2010 and ratified it in 2016.

• Despite being a nuclear-capable state, India's nuclear power capacity remains modest, with around 7.48 GW installed capacity (as of 2024), contributing less than 2% of total electricity generation.

Proposed Legal Reforms: Key Changes and Their Implications

1. Reforms to the CLNDA, 2010

• Section 17(b) currently allows operators a right of recourse against suppliers if the incident is caused by latent or patent defects in equipment or substandard services.

  • This clause is unique to Indian law and inconsistent with global norms, which typically limit supplier liability once a contract is signed.

  • International suppliers view this provision as ambiguous and financially risky, deterring investment and collaboration.

• Proposed amendments aim to weaken or clarify Section 17(b) to bring it in line with the CSC provisions and international practices.

• As per CSC, only the operator is liable, and supplier liability is allowed only if explicitly stated in a contract, not by default.

2. Inclusion of Private and Foreign Participation

• Amendments to the Atomic Energy Act, 1962 are proposed to:

  • Allow private domestic companies to operate nuclear power plants.

  • Enable foreign players to take minority equity stakes, subject to regulatory and security clearances.

• Currently, only state-owned entities such as the Nuclear Power Corporation of India Ltd (NPCIL) and NTPC Ltd are allowed to build and operate nuclear power plants.

• This reform aligns with the need for large-scale capital infusion, advanced technology, and faster project implementation.

3. Alignment with International Conventions

• The reforms are designed to align Indian law with the CSC and its Annex, thereby:

  • Enhancing legal certainty for investors.

  • Facilitating cross-border cooperation, technology transfer, and multilateral nuclear partnerships.

  • Ensuring access to international compensation pools in case of transboundary nuclear accidents.

Significance of the Reforms

A. Facilitating Foreign Investment and Technology Transfer

• Global nuclear suppliers, particularly from the United States, France, and Russia, have refrained from operationalizing agreements signed after the India-U.S. Civil Nuclear Agreement (2008) due to liability concerns.

• Legal alignment will unlock potential investments and projects like the Westinghouse AP1000 reactors and EDF-EPR projects.

B. Enhancing Energy Security and Clean Energy Transition

• India's energy demand is projected to double by 2040, and nuclear power offers a low-carbon baseload source.

• The target of 22 GW nuclear capacity by 2031 requires massive infrastructure expansion and international collaboration.

C. Strengthening India's Global Nuclear Standing

• Harmonizing with CSC provisions reaffirms India’s commitment to responsible nuclear governance.

• This enhances India's credibility in global forums such as the International Atomic Energy Agency (IAEA) and Nuclear Suppliers Group (NSG).

Challenges Ahead

• Political consensus is required for amending foundational legislation like the Atomic Energy Act.

• Public safety concerns and anti-nuclear sentiments may arise, necessitating transparent regulatory oversight.

• Ensuring independent functioning of the Atomic Energy Regulatory Board (AERB) is essential for trust and credibility.

Legal reforms to India’s civil nuclear liability framework mark a pivotal step toward enabling international cooperation in the nuclear energy sector. By aligning domestic laws with international norms under the CSC, India can address supplier concerns, attract foreign investment, and boost its nuclear energy capacity. These reforms are not merely legal updates but strategic imperatives that will contribute significantly to India’s clean energy ambitions, energy security, and global nuclear diplomacy.

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