SOS e - Clarion Of Dalit

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Sunday, August 22, 2010

Nuclear Deal - GOI Backing Corporate Criminals


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Editor: NAGARAJ.M.R… Special Issue  22.08.2010

Editorial : Civil Nuclear  Deal - Government of     India Backing  Criminal Corporations

      Is the GOI backing Criminal Corporations  , as it did earlier ?

What if a nuclear accident happens
- BILL LIMITS LIABILITY OF OPERATOR TO RS 5OO CRORE, ANYTHING ABOVE WILL BE GOVT RESPONSIBILITY


Answers to questions on the nuclear damage bill the Centre withdrew from the Lok Sabha on Monday
What is the bill’s purpose?
The Civil Liability for Nuclear Damage Bill seeks to set down mechanisms and rules for liability claims and payments that might arise because of a nuclear incident and to pave the way for India to join an international liability regime.
What kind of nuclear liability regime does India have at present?
All of India’s nuclear power reactors and nuclear facilities are owned by the central government, or by the Nuclear Power Corporation and Bharatiya Nabhikiya Vidyut Nigam (Bhavini) — both public sector enterprises. Any liability issues that emerge from incidents become the responsibility of the central government. The inter-government agreements between India and Russia under which Russia has supplied two nuclear reactors at Kudankulam in Tamil Nadu do not clarify liability issues. This has meant uncertainty over trans-boundary liability issues.
Why has the bill become necessary now?
The Indo-US civilian nuclear agreement allows US suppliers to sell nuclear power reactors to India. But the companies have been concerned about the absence of a well-defined nuclear liability regime in India. Environmental groups believe foreign companies will be reluctant to invest without a liability regime in place because they do not want to run the risk of having to compensate without a cap for a nuclear incident. Without the bill, under the existing legal regime, a company may have to encounter absolute, unlimited and non-delegable liability.
What does the bill propose?
A leaked version of the proposed bill circulated by environmental groups indicates that the government plans to cap the maximum liability for each nuclear incident to 300 million Special Drawing Rights ($460 million or Rs 2,100 crore). This is lower than the $470 million settlement in the Bhopal gas disaster.
If the claims for compensation for nuclear damage exceed SDR 300 million, an additional 300 million SDR may be available through an international convention.
The liability of a nuclear power operator (so far only the NPC and Bhavini) for each nuclear incident will be Rs 500 crore. The limit will also apply to private companies if they are allowed entry into the sector.
The central government will be liable for nuclear damage if the liability exceeds the operator’s limit.
Why has this generated controversy?
The bill has generated the widespread perception that it will allow US companies to go scot-free in the event of a nuclear accident and saddle the Indian government with the liability — in other words, Indian taxpayers will have to pay for damages. Some environmental activists are contrasting the proposed Indian cap of $460 million with the much larger $10 billion pool of funds available in the US to cover liability and provide compensation to the public in the event of a nuclear accident. Some legal experts are arguing that there is no place for a cap on liability under Indian law. Any such legislation would be vulnerable and open to challenge and could be easily struck down as a violation of the environmental jurisprudence established by India’s Supreme Court.
Will the bill really allow foreign companies to go scot-free?
A clause in the bill appears to allow the nuclear operator to have “a right to recourse” —which would mean the operator could seek assistance — when the nuclear incident has resulted from negligence on the part of a foreign supplier of a material, equipment or service. However, this would have to be reflected in written contracts between the Indian operator (the NPC, for now) and the foreign suppliers. Environmental groups are sceptical, and fear that this will not emerge in actual contracts.
How is the bill linked to the international nuclear liability regime?
The Convention on Supplementary Compensation under the International Atomic Energy Agency provides for an international fund to compensate for nuclear damage in the event of an accident. The convention envisages a two-tier system — the state will ensure availability of at least 300 million SDR, and an international fund for which all participating nations are obliged to contribute. Any country that plans to join will have to ensure its national legislation is consistent with the convention’s provisions. By enacting domestic legislation, India could join the convention and — should the event arise — also seek money from the much larger international fund, which could help India access an additional 300 million SDR.
How is nuclear liability covered in the US?
The Price-Anderson Act enacted in 1957 ensures the availability of a large pool of funds — about $10 billion — to provide compensation to people who incur damages from a nuclear accident — no matter who is liable.
Have nuclear liability claims been paid in the US?
The American Nuclear Society estimates that the nuclear insurance pools have paid a total of $151 million in the past 43 years. The US energy department has paid $65 million.
What kind of liability regimes do other countries have?
They vary from country to country. Belgium has set a liability amount of 300 million Euros, and the France 91.5 million Euros, and the UK £40 million. Germany has set unlimited liability though a financial security limit is set at about 2,500 million Euros. Japan also has unlimited liability, but a maximum financial security limit of 60 billion yen.

 



INDIA: Obama administration official supports corporate interests over victims of world's worst industrial disaster

Deputy National Security Advisor Froman reveals administration’s double standards on corporate accountability for victims of Bhopal Gas Disaster

At a time when the world is focused on corporate accountability in the wake of the BP's Gulf Oil Spill, a leaked email from the Obama administration shows that it values profit over people, when the profit benefits American corporations. The victims of the world’s worst industrial disaster were disappointed to see today that the White House is not pursuing the same levels of accountability from American Dow Chemical as it has from BP. When Dow purchased Union Carbide in 2001, the corporation acquired outstanding liability for the ongoing disaster in Bhopal, which has led to the deaths of an estimated 25,000 people in Bhopal, India following the 1984 Gas Disaster.

Today, Mumbai-based Times Now published an email chain between White House Deputy National Security Advisor Michael Froman, and Indian Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia. In response to an Ahluwalia’s email requesting assistance as India faces a sharp restriction in the World Bank’s lending, Froman replied:

"We are aware of this issue and we will look into it. We are hearing a lot of noise about the Dow Chemical issue. I trust that you are monitoring it carefully. I am not familiar with all the details, but I think we want to avoid developments which put a chilling effect on our investment relationship."

Here Obama’s Deputy NSA apparently tied potential development aid to India with Dow Chemical’s liability in Bhopal. The White House denies any linkage between the IBRD lending and Dow’s ongoing lack of responsibility. Forman’s statement shows callous disregard for ongoing injustice and lack of accountability 26 years after the disaster. The survivor organizations in India, 5 of which have been protesting in Delhi this past month, have faced infringements on their basic rights, especially through discriminatory police abuse. A threatening statement from the Obama office could further repressive action from Indian Central Government of India.

Following months of safety cuts, on Dec 3, 1984 the Union Carbide pesticide plant in Bhopal leaked deadly gas containing Methyl isocyanate (MIC) over the city of Bhopal. In the immediate aftermath 8-12,000 people died. Currently the death toll has risen to approximately 25,000 people. Over 100,000 people are still too sick to work because of long-term health disability.

The Indian Government has been forced to address the Bhopal issue in the recent months following a June 7 verdict convicting the officials of Union Carbide's former Indian subsidiary on charges of criminal negligence. The charges and sentence, equivalent to a traffic violation, enraged the Indian public, as did the fact the Union Carbide and its former CEO Warren Anderson have refused to appear in court to face charges of culpable homicide. Bhopal survivors say that Dow Chemical should not be allowed to continue doing business in India until its subsidiary appears in court and cleans up the site of the disaster.

The International Campaign for Justice for Bhopal (ICJB) is a coalition led by four survivor organizations along with environmental, social justice, progressive Indian, and human rights groups around the world. ICJB works to hold the Indian Government and Dow Chemical Corporation (the current owner of Union Carbide) accountable for the ongoing chemical disaster in Bhopal, India. It was set up to address the grave injustices suffered by the half million Bhopal Gas Disaster survivors.


CONTACTS:
Shana Ortman, 415-746-0306, shana@panna.org , ICJB U.S. Coordinator
Claire Rosenfeld, 408-348-2554, clairerosenfeld12@gmail.com , ICJB U.S. Campaigner
www.studentsforbhopal.org  * www.bhopal.net 


Nuclear Liability Bill in India

 

NEW DELHI: Government has brought some fresh amendments to the Nuclear Liability Bill that are likely to trigger a fresh controversy as these could be seen as diluting the right of recourse of operator to seek damages from supplier in the event of an accident.

One of the 18 amendments cleared by the Union Cabinet yesterday suggests that an accident in a nuclear plant should have occurred as a consequence of an act done with an "intent" if an operator has to claim damages from supplier.

The amended Clause 17 says "the operator of a nuclear installation, after paying the compensation for nuclear damage in accordance with Section 6, shall have a right of recourse where --

(a) such right is expressly provided for in a contract in writing;

(b) the nuclear incident has resulted as a consequence of an act of supplier or his employees, done with the intent to cause nuclear damage, and such act includes supply of equipment or material with patent or latent defects or sub-standard services;

(c) the nuclear incident has resulted from the act of commission or ommission of an individual done with intent to cause nuclear damage."

Experts feel that the mention of "intent" in the sub-clauses (b) and (c) regarding an accident may give a route to suppliers to escape responsibility because it would be difficult to prove intent in any such mishap.

This amendment in the Civil Liability for Nuclear Damage Bill, 2010 will be moved along with 17 other amendments in the Lok Sabha on August 25.

Significantly, neither the original bill nor the recommendations of Parliamentary Standing Committee which examined it had contained such a proposal.

Only earlier this week, the government had to beat a hasty retreat when a controversy arose over inclusion of a word "And" between sub-clauses (a) and (b) in Clause 17 which the BJP and Left parties feared diluted the supplier's liability in case of an accident.

The government then dropped the controversial word but reworked the language of the Clause 17 in which the word "intent" has been included.

CPI leader D Raja reacted strongly to the fresh changes made by the government, saying these would dilute the supplier's liability drastically.

"I don't understand what they say. Disaster is a disaster. Who will agree that this was done willfully or deliberately. It is irrational and ridiculous," he said.

The Left parties would look at the amendments carefully when these are brought to Parliament and decide their strategy.


Read more: Fresh changes in N-bill may trigger a new row - India - The Times of India http://timesofindia.indiatimes.com/india/Fresh-changes-in-N-bill-may-trigger-a-new-row/articleshow/6388939.cms#ixzz0xJX0utbm

 

 

Capping nuclear liability is a non-starter

Soli J. Sorabjee

The government proposes to introduce a Civil Nuclear Liability Bill to appease foreign investors. Any legislation that attempts to dilute the Polluter Pays and Precautionary Principle and imposes a cap on liability will be in blatant defiance of Supreme Court judgments and is likely to be struck down.
One of the vital guarantees in our Constitution is the protection of the Right to Life enshrined in Article 21. Our Supreme Court by creative interpretation ruled that the expression ‘life’ does not connote merely physical existence but embraces the right to live with “human dignity and all that goes along with it, namely, the bare necessaries of life such as adequate nutrition, clothing and shelter over the head.” Thereafter it further expanded the concept of the right to live with human dignity to encompass within its ambit, the protection and preservation of environment, ecological balance free from pollution of air and water.
Our Constitution evinces great concern for environment. Article 48-A of the Directive Principle mandates that the state shall endeavour to protect and improve the environment. One of the fundamental duties prescribed in Article 51-A is, inter alia, to protect and improve the natural environment.
Despite these constitutional provisions, pollution continues unabated. The river Ganges was brazenly polluted by the discharge of effluents by some tanneries in Kanpur who, despite notices issued by the Supreme Court to take steps for the primary treatment of industrial effluent, had utterly failed to do so. Hence the court was constrained to issue directions for the closure of the tanneries. The court was conscious that closure of tanneries may bring unemployment and loss of revenue, but it significantly ruled that “life, health and ecology have greater importance to the people.”
In its landmark judgment in the Oleum Gas Leak case, the Supreme Court laid down certain important principles. A five-judge bench unanimously ruled that “an enterprise which is engaged in a hazardous or inherently dangerous industry which poses a potential threat to the health and safety of the persons working in the factory and residing in the surrounding areas owes an absolute and non-delegable duty to the community to ensure that no harm results to anyone on account of hazardous or inherently dangerous nature of the activity which it has undertaken.” The court further held that “it should be no answer to the enterprise to say that it had taken all reasonable care and that the harm occurred without any negligence on its part.”
At first blush, this may appear unduly harsh. However the rationale for this rule as explained by the court is that “such hazardous or inherently dangerous activity for private profit can be tolerated only on condition that the enterprise engaged in such activity indemnifies all those who suffer on account of the carrying on of such activity regardless of whether it is carried on carefully or not.” Therefore in a case of escape of toxic gas, “the enterprise is strictly and absolutely liable to compensate all those who are affected by the accident and such liability is not subject to any of the exceptions.”
In 1996 in the case of Indian Council for Enviro-Legal Action Justice Jeevan Reddy speaking for the court pointed out that the rule of absolute liability is premised on the very nature of the activity carried on and “it is the enterprise carrying on the hazardous or inherently dangerous activity alone has the resource to discover and guard against hazards or dangers.” The court further introduced the Polluter Pays Principle, which according to it requires that the financial costs of preventing or remedying damage caused by pollution should lie with the undertakings that cause the pollution. Under this principle, it is not the role of government to meet the costs involved in either prevention of such damage, or in carrying out remedial action, because the effect of this would be to shift the financial burden of the pollution incident to the taxpayer. The responsibility for repairing the damage is that of the offending industry. It is noteworthy that the Polluter Pays Principle has been incorporated into the European Community Treaty as part of the new articles on environment that were introduced by the Single European Act of 1986.
In its subsequent judgment in Vellore Citizens Forum, Justice Kuldip Singh speaking for the court held that “the Precautionary Principle and the Polluter Pays Principle are essential features of Sustainable Development.” This is a milestone judgment in our environmental jurisprudence. The court reaffirmed the Polluter Pays Principle laid down in its previous judgments to mean that “the absolute liability for harm to the environment extends not only to compensate the victims of pollution but also the cost of restoring the environmental degradation. Remediation of the damaged environment is part of the process of Sustainable Development and as such the polluter is liable to pay the cost to the individual sufferers as well as the cost of reversing the damaged ecology.” The seminal significance of this judgment lies in the court’s holding that the Precautionary Principle and the Polluter Pays Principle are part of the environmental law of the country and the court’s pointed reference to Articles 21, 47, 48-A, and 51-A (g) of the Constitution in this connection.
The thrust of these Supreme Court judgments is for compensating and protecting the victims of accidents as part of their fundamental right to life under Article 21 of the Constitution. Under our Constitution, Supreme Court judgments constitute the law of the land and are binding on all courts, authorities and persons.
It is claimed that foreign companies are reluctant to invest in India as they do not want to run the risk of having to compensate without a cap for a nuclear accident on account of imposition of absolute liability. It is understood that the government to appease the foreign investors proposes to introduce a Civil Nuclear Liability Bill whereby inter alia the compensation payable in case of a nuclear accident is capped at $450 million.
In effect, this means that in case the actual damage and the cost of remedying environmental degradation exceeds the proposed ridiculously low cap of $450 million or any other sum, the government would have to bear the remaining burden. This would be directly contrary to the Supreme Court’s ruling that it is not the role of the government to meet the costs involved. The effect of a cap in reality would be to shift the financial burden of the consequences of the accident to the taxpayer. According to the Polluter Pays Principle that has been embedded in our jurisprudence, the liability and responsibility for compensating the victims of accident and remedying the environmental damage caused is that of the offending industry alone. No part of the liability can be limited nor passed on to the government.
There can be two views about the advantages or disadvantages of foreign investment in India in the nuclear energy sector. But there can be only one view: health well-being and protection of our people are paramount and must override dollar considerations. Foreign multinationals are not solicitors of the fundamental rights of our people. The Bhopal Gas case is a burning reminder.
Any legislation that attempts to dilute the Polluter Pays and Precautionary Principle and imposes a cap on liability is likely to be struck down as it would be in blatant defiance of the Supreme Court judgments. Moreover, it would be against the interests and the cherished fundamental right to life of the people of India whose protection should be the primary concern of any civilised democratic government.


India’s Nuclear Liability Bill

Chaitanya Ravi
A Civil Liability for Nuclear Damage Bill that is essential for American commercial nuclear firms to enter the US$150 billion Indian civil nuclear energy market has sharply polarized India’s political, legal and strategic communities. The government deferred the introduction of the bill in Parliament after strong opposition from India’s major opposition parties in March 2010.

Passage of the bill is considered important for the full implementation of the landmark Indo-US nuclear deal that was signed in December 2008. It may also result in contracts worth US$10 billion for the moribund American nuclear industry from the two reactor sites allotted to Westinghouse Electric (a unit of Toshiba) and GE Hitachi by the Indian government. Indian planners consider nuclear power to be an important part of the energy mix and aim to increase nuclear capacity from the current 4560MW (3% of total capacity) to 20,000MW by 2020 and 63,000MW by 2032. 

Bitter memories of past industrial accidents and pricing controversies over major power projects among India’s political and intellectual class has cast a shadow over the nuclear liability debate. India lost 3,800 people in a gas leak at the Union Carbide factory in Bhopal in 1984 and was polarized over pricing issues concerning the US$2.9 billion Enron power project.

At present, India is not a party to any of the four international nuclear liability conventions (the 1960 Paris Convention, the 1963 Vienna Convention, the 1997 protocol to Amend Vienna Convention and the 1997 Convention on Supplementary Liability for Nuclear Damage). Its domestic nuclear law (Atomic Energy Act of 1962) says nothing about nuclear liability or compensation for nuclear damage resulting from a nuclear accident.

Since all civil nuclear facilities are owned by the Central Government (Nuclear Power Corporation of India Limited and the Bharat Navbhikiya Vidyut Nigam, both public sector enterprises), the liability issues arising from these installations are its responsibility. Under existing Indian legislation, foreign suppliers may face absolute, unlimited and non-delegable liability, something that prevents them from taking insurance cover. Private American firms are more affected than their government backed French and Russian counterparts. There is no clarity over trans-boundary liability issues and liability during transport of nuclear material.

The provisions in the bill that deal with total compensation in case of a nuclear accident and limits on the liability of the nuclear operator are the most controversial. Clause 6 caps the maximum amount of liability in case of a nuclear accident at 300 million Special Drawing Rights (SDR’s- around US$460 million or Rs2100 crore) while the liability of the operator for each nuclear incident has been capped at Rs500 crore. The government will be responsible for liability over Rs500 crore.

In a move that is likely to strengthen the government’s case, the country’s atomic energy establishment including Srikumar Banerjee, Chairman of the Atomic Energy Commission, Anil Kakodkar and MR Srinivasan- both former Chairmen of the Atomic Energy Commission have come out in support of the deal. They have pointed out that India needs a well defined liability framework and claim that the liability bill will pave the way for India to join an international liability regime and access additional funds (if compensation claims exceed the overall cap specified in the liability bill, an additional 300 million SDR can be made available through the Convention on Supplementary Compensation).

Clause 3 of the bill requires the Atomic Energy Regulatory Board to notify the nuclear incident within fifteen days. Clause 9 empowers the Central Government to appoint a Claims Commissioner (or a Nuclear Damages Claims Commission if the liability exceeds Rs500 crore) for adjudicating claims for compensation and deciding awards.
Opponents like anti-nuclear activist Praful Bidwai and leading strategic expert Brahma Chellaney argue that the government, by channeling the legal and financial liability to the operator is exempting foreign suppliers from the legal and financial fallout of negligence at the cost of the Indian taxpayer.

Former Attorney General Soli Sorabjee has termed the US$460 million cap as ‘ridiculously low’ and has argued that the legislation “attempts to dilute the Polluter Pays and the Precautionary Principle,” in “blatant defiance of Supreme Court judgments.” He reckons that the legislation “would be against the interests and the cherished fundamental right to life of the people of India whose protection should be the primary concern of any civilized government.”

Critics have also questioned the ten year time limit to claim compensation for any nuclear damage (Clause 18) and argue that the effects of radiation extend across generations.  They are strongly opposed to Clause 35 of the bill that prevents Civil Courts from exercising any jurisdiction over the proceedings of the Nuclear Damages Claims Commission and its final award; which according to them, is tantamount to preventing victims from suing foreign suppliers in Indian courts.



Bhopal and the BP Oil Spill: A Tale of Two Disasters

By Madhur Singh

As BP struggles to contain the damage the Deepwater Horizon oil spill has caused to the Gulf of Mexico and to the people whose livelihoods depend on its waters, a legal judgment in the worst industrial catastrophe in history highlights how wrong the aftermath of such disasters can go — not just in terms of a cleanup but in the matter of justice. It is a terrifying lesson in how a corporation can evade full responsibility for one of the most heinous accidents in human history.
On Monday, more than 25 years after 40 tons of highly toxic methyl isocyanate (MIC) was released from a Union Carbide plant in the central Indian city of Bhopal — killing thousands in a matter of hours and over years, rendering hundreds of thousands seriously ill and causing genetic defects in yet-to-be-born generations — a local court announced its verdict. It held eight former employees of Union Carbide India Ltd guilty of criminal negligence and sentenced seven of them to two years in prison and a fine of $2,100. (The eighth defendant died during the course of the 23-year trial.) The convicted former employees were out on bail — of just $500 each — in less than two hours. Union Carbide India, which no longer exists, was fined less than $11,000. (See the legacy of the Bhopal disaster.)
The judgments are likely to be appealed. Given the speed of the wheels of justice in India, the case is likely to outlast most of the Bhopal survivors and the accused. The most prominent name in the latter category is Warren Anderson, the American CEO of Union Carbide, the U.S. parent company. He is now 89 years old. Arrested by Indian police when he visited the disaster site, he was released on bail and flew out of the country. He continues to be a fugitive from Indian law and hence has not been tried. (He is believed to be living somewhere in New York state.) At the same time, no one has been assigned responsibility for cleaning up Bhopal's ground zero, which researchers and activists say continues to leach toxic chemicals into the groundwater, used by thousands of families. (See TIME's 1984 cover story on the Bhopal disaster.)
The outcome of the case has ignited outrage and disbelief across India. No less than the Law Minister and a former Chief Justice have said justice has been delayed and denied. The Economic Times newspaper led its front page with the headline "After 25 Years, Another Tragedy Strikes Bhopal." "We are used to being let down," says Rachna Dhingra of the Bhopal Group for Information and Action, her voice catching as she spoke to TIME by phone, "by our government ... now even the judiciary."
The letdowns have been serious and repeated — and apparently preordained because of decisions that facilitated the disaster itself. Investigations over the years have shown that the Bhopal plant design was faulty and that there was next to no emergency preparedness — issues that the parent company in the U.S. apparently knew about, according to the groups that conducted the studies. The company was operating in India with standards unacceptable in the U.S. (See pictures of the Gulf oil spill.)
The Indian government seemed to go out of its way to cushion the experience for Union Carbide. After first suing the company for $3.3 billion in 1985, New Delhi announced an out-of-court settlement of $470 million in February 1989. Then a 1996 ruling by another Supreme Court judge watered down the charges against the accused from culpable homicide (with maximum punishment of 10 years' jail term) to criminal negligence (maximum sentence two years).
The various governments that have ruled India in the meantime have not taken on Union Carbide, which is now owned by Dow Chemical. Meanwhile, Keshub Mahindra, chairman of Union Carbide India Ltd at the time of the Bhopal disaster and now chairman of India's automobile giant Mahindra & Mahindra, was nominated for a civilian honor, the Padma Bhushan, in 2002. He had to decline in the face of widespread protests.
Although environmental legislation was ramped up in the wake of the Bhopal disaster, companies continue to operate in India in ways that severely — if not as dramatically — pollute the environment and impact people's health and livelihoods. Britain-based mining major Vedanta, for instance, has faced censure from Amnesty International for violating the human rights of communities in Orissa, where it operates bauxite mines. India continues to be the world's e-waste dump. Of late, the government, keen to attract foreign investment to its nascent nuclear energy market, has been pushing a bill to limit the liability of a nuclear-plant operator to $111 million. "We've learned nothing from Bhopal," says Supreme Court lawyer Prashant Bhushan. "There is a drive to attract foreign investment overwhelming all other considerations." Opposition parties have already demanded a rethink of the proposed legislation in the face of the Bhopal outcome. (See pictures of people protesting BP.)
There is still outrage that the U.S. refuses to extradite Warren Anderson to face criminal charges in India. New Delhi made the request in 2003, and it was refused the year after. U.S. Assistant Secretary of State for South Asia Robert Blake, reacting to Monday's Bhopal verdict, said, "I don't expect this verdict to reopen any new inquiries or anything like that. On the contrary, we hope that this is going to help to bring closure." The Bhopal activists now plan to file a writ petition in the higher court to admit more charges against Union Carbide and Anderson, seeking an as-yet-unspecified figure for personal and property damages, health monitoring and cleanup of the site, which is likely to run into billions of dollars.
Indians point at the way the U.S. government is now confronting BP — holding it squarely responsible for the oil spill and accountable for all cleanup costs — as a stark contrast to the way their own government has dealt with Union Carbide. The hope in India is that U.S. courts will be more amenable to the requests of Bhopal's victims now that America has a huge environmental disaster in its own backyard. The Bhopal activists say the Indian government must join the case in the U.S. as a plaintiff (indeed, it owns the land on which the Union Carbide factory was located). "Prime Minister Manmohan Singh should be inspired by President Obama's recent commitment toward making BP pay every cent for its oil spill," says Satinath Sarangi of the Bhopal Group for Information and Action. "And the U.S. government must follow the same standards on corporate liability for U.S. corporations operating in India as it expects for corporations operating in the U.S."
See the world's top 10 environmental disasters.
See pictures of critters caught in the Gulf oil spill.

BP and Union Carbide:
Corporate Responsibility or Corporate Liability

by Mukesh Williams


Two momentous events separate in time and location have seared our consciousness—the British (Beyond) Petroleum Gulf Coast oil spill on April 20, 2010 and the American Union Carbide Bhopal Gas Tragedy in December 3, 1984. Twenty five years separate these two environmental and human disasters but the greed of big multinational corporations in connivance with state and central agencies still remains insatiable. With a keen eye on profit, big companies compromise safety standards, falsify data, overstate their strength, underestimate their drawbacks, bribe officials, lobby for protection and misinform the public. It is rather difficult to fuse ethical economic standards with ravenous profit-making schemes. Though oil and gas stink most multinational corporations love it.

The neo-classical model of economics has reduced our land and environment to a mere abstraction that can be exploited in terms of supply and demand without compunction. Big companies continue to wreck havoc on our human and natural systems devastating our lives in the name of human progress and development. At such moments we often wonder where is the fashionable concept called social corporate responsibility that is often taught as a philanthropic and ethical tool in business management departments to unsuspecting students. Corporate greed like all other forms of human greed need to be kept under strict check by international pay czars or up-to-date legislation based on global standards with teeth for swift punishment. Also the rhetoric of corporate companies must be separated from what they actually do, how long they do what they do, and what they hide. A constant monitoring system both on the part of governments and private groups must be effectively installed in collaboration with the media to thwart their nefarious activities and ulterior motives.

Union Carbide Bhopal Gas Tragedy 1984

Early this month the Indian Supreme Court passed a verdict indicting the American CEO of Union Carbide Warren Anderson who was allowed to escape to the United States twenty five years ago possibly with the connivance of either the state or central agencies in India. Now both the Congress government and state ministries are trying to escape their involvement in the murky plot. Who wanted the truth then? And who wants the truth now? The declassified CIA report of December 8, 1984 and recent revelations by the principal secretary of Rajiv Gandhi, P. C. Alexander, point to political intrigue involving both state and center in releasing Anderson. Now some leaders claim that the worsening law and order situation in Bhopal in the wake of the accident forced Chief Minister Arjun Singh to provide a safe corridor to Anderson out of the country. Some like Rajinder Puri even see the direct hand of Rajeev Gandhi himself. It seems that US President Ronald Reagan phoned Rajeev Gandhi to release Anderson. The media would like us to believe that even P. Chidambaram and Kamal Nath were campaigning for Dow Chemical to get special concessions so it could invest in India. The chief minister of Gujarat Narendra Modi criticized Sonia Gandhi for the complicity of the Congress Party in the murky affair but it has come to light that he had signed an MOU between state public sector company Gujarat Alkalies and Chemicals Ltd and Dow Chemicals in April 2008. This is the case of the pot calling the kettle black.

Seemingly neither the American nor the Indian establishments saw the industrial disaster as the responsibility of the MNC Union Carbide. The company was bought by Dow Chemical Company in 1999 further camouflaging accountability. Dow Chemical was the second biggest Texas polluting company in 2009 and paid 1.14 million USD on eight counts of pollution. Now it is investing again in India with the syrupy connivance of people in power.

Even after 25 years the public would like to know if it was Arjun Singh the chief minister of Madhya Pradesh or influential persons in Rajiv Gandhi’s government at the center or the prime minister himself responsible for giving a free passage to Anderson to fly back to the U.S. India has an extradition treaty with the United States and under changed circumstances today when America itself is suffering from another MNC BP, there might be possibility of bringing the fugitive CEO back to justice if India can put together enough evidence. Greenpeace believes that in the 1982 safety audit of the Bhopal factory in the US addressed thirty safety hazards. Anderson knew about them and compromised safety standards causing the death of 20,000 people and affecting 578,000 to date. To make the tragedy reprehensible the out of court settlement made Union Carbide pay a sum of 470 million USD instead of 3.5 billion initially demanded, with each victim getting a measly sum of 550 USD in 1989. In the same year Exxon oil spill in Prince William Sound Alaska forced the company to pay 5 billion USD of which it paid half. Even today there is 425 tons of hazardous waste in Bhopal left by Union Carbide that needs to be cleaned. Who will do it—Dow Chemical or the Indian state government?

Anderson now 90 years lives in a luxury home worth 900,000 USD at 929 Ocean Road, Bridgehampton, Long Island, New York. He is now less of a fugitive and more of a monarch (Sonnenfeld, 1991). It is obvious that in many cases justice delayed is justice denied. Should we stop big companies from doing business? Should we impose heavy penalty on erring foreign companies? Or should we reform the slow and cumbrous judicial system? Jeremy Kahn writing in The Faster Times calls for judicial reform rather than protectionism (Kahn, 2010). The Indian Parliament is debating a law capping liability for foreign nuclear power companies involved in disasters to pay 100 million USD a pittance when compared to the US demand of 100 billion USD from BP. Then Indian law capping liability lacks teeth and may not cover non-nuclear companies. So they can pollute as of before.

British or Beyond Petroleum

The British are desperate to save BP from going down by bringing silly arguments like BP has been a part of America since it merged with American energy Amoco in 1998 and acquired the Gulf of Mexico drilling rights (The Independent, “Cameron Warns Obama over Criticizing BP” 13 June 2010). The new British Prime Minister David Cameron has also chipped in underscoring the sustained “economic importance” of BP to both Britain and America. American President Barrack Obama however is needled by US senators, whose states have been ravaged by oil spills, to push for 100 billion USD compensation, which if realized would force BP to go bankrupt. The British media believes that Obama’s anti-British rhetoric is testing Anglo-American relations. Obama claims that American relation with Britain has not been affected. The environmental disaster caused by a British multinational company should have nothing to do with national identity but corporate liability. Obama has called BP the Swedish Chairman Carl-Henric Svanberg, who earns a fat cat salary of 3.8 million USD, to the White House for consultations.

The British are cut up with Obama’s off the cuff remark that he would have fired BP’s chief executive Tony Hayward if the latter had worked for him. With US pressure rising BP may not pay its quarterly dividends which are essential to maintain equilibrium for UK pension funds. The 6.7% shares lunge in the FTSE has adversely affected pension funds in the UK. If the status quo is not altered by American pressure groups BP might only have to pay 20 to 37 billion USD provided it can be proved that BP failed to meet safety regulations in the deep sea oil drilling.

Now BP is using two kinds of dispersants manufactured by Nalco—Corexit 9500 and Corexit EC 9527A. Corexit (deodorized kerosene) is banned in the United Kingdom as even 2.61 ppm can kill 50% of fish in 96 hours. The dispersants turn the oil slick into small particulates which settle on the sea bed and make things look clean on the surface, but they destroy marine life below. Corexit however is on the approved list of dispersants by the US Environmental Protection Agency though the EPA has advised BP to use less toxic dispersants. BP however refused citing lack of availability. The toxicity of the present dispersants increase when they get mixed with oil. BP has links with Nalco. BPs has poured 1,621,000 gallons of dispersants in the Gulf of Mexico to contain the oil spill and has ordered for an additional 805,000 gallons. The ill effects of the dispersant on humans can result in various diseases, reduced growth, kidney failure and death.

The British rely on BP as the national icon and savior of British deficit. Last year BP paid 1.4 billion dollars in taxes on its profits. The oil spill in the Gulf of Mexico is too far away for the ordinary Britons but the pension funds and BP dividends are closer home.

It stands to logic that a “large, wealthy company” which is eager to pay 1.8 billion quarterly dividends to its shareholders and whose last year’s sales and operating revenues were 239 billion USD, should pay 100 billion USD in damages. Since the oil spill began on April 22, 2010 till June 15, 2010, 55 days have gone by. And if we estimate the oil spill at 50,000 barrels a day it comes to 27500000 gallons. If each gallon spill is fined 4300 USD as the US is suggesting the actual fine would come to 118,250,000,000 that is about 118 billion USD. These figures may not be exact and are vigorously contested by BP which would like to work with half the numbers. However the end is not in sight. According to BP officials it would not be before August that the spill can be contained. If this is true then the figure could be doubled and BP would have to pay damages amounting to all the revenue it earned through sales last year.

Both the American government and public are hopeful that since earlier erring companies like Texaco was forced into bankruptcy in 1987 after paying 10.53 billion USD claim, BP too would have to cough up huge sums. And BP’s reputation does not help a wee bit whatever they claim to the contrary in those daily briefings on the Internet. BP is known as one of the “ten worst corporations” in the world when evaluated on their environmental pollution and infringement of their human rights record. It also has the dubious distinction of being the most polluting company in the United States vis-à-vis EPA toxic release data of 1991. It has been fined 1.7 million USD for burning polluted gases at its Ohio refinery. It also paid 10 million USD fine to the EPA in July 2000 for mismanaging the US oil refineries. The US Public Interest Research Group or PIRG claims that between Jan 1997 and March 1998, BP was involved in 104 oil spills. Obviously a lot of wealthy shareholders, 37% on the British and 31 % on the American side do not want this to happen.

BP’s propaganda regarding its CSR is highly effective as it tries to highlight only the positive aspects of what it has done. In the past BP has invested some money in alternate fuel and green technologies but it has been criticized for proving private funds to public universities of the California Bay Area and closing down its green technology office in London. Its critics call its green technology projects as green washing projects. BP is also a leading producer of solar panels and holds 20% of the global market in this area and it uses this fact to great advantage for image building. It operates the ampm convenience store chain in the US and other countries and is the leading producer of wind power. It is also involved in funding local and international politics. It gave 5 million USD to democrats and republicans in 1990 and spent 16 million USD in lobbing at the US Congress. The moral of the story is that it is not as clean as it claims, nor concerned with the lives of common people unless it serves its purpose or national interest.

BP in its regional spill plan for the Gulf of Mexico and site plan for the Deepwater Horizon rig understated the dangers and overstated its preparedness in the eventuality of a leak. Louisiana governor Bobby Jindal criticized BP for being ‘reactive’ and not ‘proactive’ from the very beginning. Now BP’s report is examined quite critically and it has been discovered that an expert professor listed in its 2009 response plan died in 2005. It lists walruses, sea otters, sea lions and seals as “sensitive biological resources” when none inhabit the Gulf of Mexico. Also names and phone numbers of marine specialists and marine network officers in Louisiana and Florida are not correct. The Justice Department has to find evidence that BP destroyed key documents or lied to the government (The Daily Yomiuri, June 11, 2010).

Corporate Social Responsibility

Corporate social responsibility is one of the modern movements like environmental or tribal movements that have become the buzz word in both business and academic circles. Both businessmen and academics are cashing upon the divine benefits of CSR making more money for their companies and jobs for their departments. Middle level managers and professors have extolled about the virtues of CSR with other buzz words such as people friendly, eco friendly and sustainable. We have come to hear about the unselfishly egalitarian aspects of CSR. It is really a wondrous transformation of the greed-driven capitalist economy of which the corporate system is a byproduct.

Most critics of CSR are not against it per se but against the recent hype associated with it as a panacea of all corporate evils. It is hard to believe that companies are out there not to make profit. We are not talking of basket cases but any company worth its salt aggressively markets itself to make real profit. And what’s wrong in it. Companies are floated for this very purpose both by the shareholders and managers. But in a changed climate of political advocacy of human rights against corporate greed, CSR seems to a new combative tool for companies to be both politically correct and make money as usual. The problem however is that if business corporations give an inch they take a mile.


Definitions and Objections to CSR

In the United States CSR is seen as philanthropy while others see it as improving society, workforce and government. There are arguments in favor of CSR where it is believed that it can support the social fabric of society and promote responsible business practices. But CSR is usually presented as a marketing strategy that articulates business performance rather than encompass social and ethical standards. The recent collapse of American business and manufacturing sectors has revealed the gap between CSR and actual self-regulation. Some CSR models take the company beyond the law into providing public benefits, increase sales, market shares, brand position, retain employees, reduce operating costs and increase investments (Baron, 2001 7-45). There are models of CSR that take into account competitive advantage, positioning, commitment, organizational integration, shareholder’s cooperation and self-correction. CSR helps to create a positive image of a company and brings it rich dividends. Though there are many definitions of CSR we must see CSR as the way business companies conduct their core business not the sops they give to society.

A common objection leveled against CSR comes from the advocates of the laissez faire system who complain that CSR infringes upon the human rights of company shareholders as company managers unilaterally divert company resources to society in the name of better management (Sternberg, 1999). Detractors of CSR complain that there should be a stakeholder claim in CSR as to how it is done. A business corporation should be fair and honest to both the shareholders and customers. CSR therefore depends on the model a company chooses and the reasons for its choice. If a company uses CSR for image building through philanthropy it leads to both ethical and human rights problems. You cannot give away money which ultimately belongs to someone else. On the flipside it also follows that if stakeholders possess sole rights they also should bear full responsibility when there are environmental or social disasters. However if a CSR model seeks a consensus of both stakeholders and company managers then it must become more open to the public. CSR must concentrate upon building customer relationships, attracting talented people, conducting risk management and building the company’s reputation.

Corporate Reputation and CSR

Corporate business companies such as BP or Coca Cola cannot ignore their reputation as about 90 to 95 percent of their assets are intangibles and the remainder immovable property. Big companies such as General Electric, IBM or Motorola use the rhetoric of CSR to show public responsibility and environmental concerns but while conducting hard-nosed bullying business practices are not so transparent in their dealings. A few years ago Sir John Browne of BP was praised for his aggressive promotion of BP while providing environmental leadership but now we come to know that all along BP compromised on safety costs in oil drilling. This is happening in a powerful country like the United States where both politics and laws are strong. Had it happened in a developing or a poor country, things would have been quite different. BP would have gotten away cheaply and Union Carbide once did.

CSR invariably works for companies and countries with resources and political clout. It is not for companies which are small and weak. Small companies fight for survival, cut costs to make ends meet and do not possess precious resources to waste on CSR. Nor can they follow up on legal battles if they come under the scanner. They function in a world of poverty, deprivation and loss.

Conclusion

It is no longer tenable to follow neo-classical economics of Smith, Mill and Bacon that the world is made for us and for us alone. We must eschew the economic theories of Pareto and Hayek as we can no longer treat nature as a mere variable and commodity. Depreciation of ecological assets has taken place at an increasing fast rate. Economics should no longer be about inflation, economic value of goods or maximization of income. It should take into account our natural world as property that belongs to every one of us (McNeill, Padua, Rangarajan, 2010 1-3). We must learn new lessons from ecological economics and environmental history and change the way we do business. We must rein in corporate greed by modifying corporate social responsibility (CSR) to corporate legal liability (CLL) and connect it to governmental deterrence, legal action and international treaties to scare the hell out of the merchants of greed and death who have many supporters in different parts of the world.


An Analysis of Civil Liability for Nuclear Damage Bill 2010

- Professor Madabhushi Sridhar


In recent times, no draft law has generated such a commotion among various sections of people as the Civil Liability of Nuclear Damage Bill 2010 has. This article is an attempt to explain and analyze the Bill with the background of law of liability that evolved over a period of time.
I. Background
Because developing India needs more power to meet increasing demands and it is not self-sufficient in nuclear fuel; India is importing it. Following the successful clinching of the Indo-US Nuclear deal, on October 10, 2008, India contemplated an ambitious goal to increase 5-fold the amount of electricity produced from nuclear power plants to 20,000 MWe by 2020 to be further increased to 63,000 MWe by 2032. Then India will be producing 25 percent of its electricity from nuclear power plants by 2050. India’s present production of electricity through nuclear power is 3981 MWe. Thus it offers very lucrative field for nuclear reactor manufacturing MNCs of US and other countries.
Nuclear Power or Nuclear Market? Whether India’s claim that it is a nuclear power is true or not, it is now being considered as a big nuclear market. The US was in forefront in imposing isolating sanctions over India after it declared itself as ‘nuclear weapon power’ with five explosion tests on May 11 and 13, 1998. Thereafter, the US changed its policy and offering unprecedented cooperation in the field of nuclear power in India, radically reversed the situation in 2005. The US lobby has even coerced international community to accept India as legitimate partner in civilian nuclear trade.  The 45-member Nuclear Supplier Group (NSG) on September 6, 2008 granted a unique waiver to India also.  The Indo-US nuclear deal initially appeared to be bilateral, later it gradually opened up doors to the global nuclear market. This market remained out of bounds for India since first its nuclear test conducted by India on May 18, 1974 with the plutonium obtained from the spent fuel rods of the nuclear reactor CIRUS supplied by Canada to India onto the path of developing capabilities to generate nuclear power (only) for “peaceful” purposes. But west did not believe this ‘peaceful’ adjective of India, which perhaps now believes. Thus the Indo-U.S. nuclear deal has cleared many international obstacles to the import of enriched uranium, nuclear fuel, and related technologies, and opened the door for subsequent similar deals with countries such as France and Russia. It is in the interest of global market need to deal with India which has a potential scope as purchaser of reactors, which the American and other industry is looking at.
While US desires to grab this market through its own MNCs and prevent nuclear industrial giants from other western countries from taking it over, India too was anxious to fall in line to attract the US companies involved in nuclear commerce such as General Electric and Westinghouse. But only major hindrance the global market considered is the baffling liability for nuclear accidents. As the population is dense, damage could be severe in case of nuclear tragedy their profit range would drastically fall. They are prevailing over the law makers in India to introduce this kind of law limiting their liability or providing a kind of certainty as to the quantum of possible liability. Even the insurance lobby is bringing pressure to limit its ‘risk’. The main aim of this bill appears to fulfill the desire of MNCs by which they could secure insurance cover for a fixed amount in their home state. The aims and objectives of the bill are written in very attractive way saying – it is to legally and financially bind the operator and the government to provide relief to the affected population in the case of a nuclear accident. The developments in international nuclear community in recent years circling around India suggest that the US might have linked the completion of the Indo-US nuclear agreement to India’s capping of nuclear liability.

In his analytical article, Mr. Sukla Sen[1] says that India is paying back for the generosity of US and explained US pressure behind the bill:

This Bill is generally being looked upon as a continuum of that process, allegedly, in order to ensure a “level playing field” for the American enterprises – to let them have a significant share of the cake[2] – the Indian nuclear market – a part payback for the American generosity bestowed upon India, for its very own reasons though. The move had, however, been first conceived by the then NDA government way back in 1999[3].  When the US Secretary Of State, Hillary Clinton, visited India in July 2009[4], there were talks of the Bill getting passed by the Indian Parliament. But nothing of that sort happened. Again in late November 2009, when Singh was to meet Obama in Washington DC[5], there was talk of getting the Bill enacted. Even then, it did not happen. The Union Cabinet had dutifully approved the Bill just on the eve of the visit though. With Manmohan Singh to visit the US to attend the Nuclear Security Summit, called by President Barack Obama, slated to be held on April 12-13[6] the government was again trying to push it through. Never mind the considerable cooling off of Indo-US relations in the meanwhile as compared to the George Bush days[7].

Another famous critique, Praful Bidwai[8] wrote about US interest in maximizing its business and hurry preventing the competition from other western countries:
The US evidently wants a share of India’s nuclear power pie for American corporations and is loath to see the French and the Russians cornering the bulk of the new atomic power projects that have been made possible by the US-India nuclear deal and its endorsement by the International Atomic Energy Agency and the 45-nation Nuclear Suppliers Group—secured by Washington. But so crude is the application of the US pressure, as usual, that it is somewhat counterproductive…. Besides being messy, such a compromise would still leave the bill’s basic flaws unaddressed.
The discreet demand to limit the liability itself reflects lack of concern for human lives, exposing them to nuclear accidents and also represents disinterest in shouldering responsibility for damaging consequences. If ‘absolute liability’ law remains in force the western MNC considers it as a big financial burden. It is evident that they do not worry about the fatal consequences of lethal nuclear accidents. Without the fear of huge damages and criminal liability how any MNC will realize responsibility to improve safety? It might be in their business interest the MNCs are pressurizing the third world to make a law for limiting their liability, with a veiled threat that otherwise none would provide fuel and technology to any Indian nuclear power plant. But why the states under rule of law with welfare objective which are expected to secure the lives of the people, offering these exemptions and immunities? Is it not inhuman that no nuclear exporting country or company is willing to undertake the responsibility of safety in operations and maintenance of the plant in a country to which it has sold nuclear fuel, generator and technology? Their liability to the human lives and environment depend upon their fault and not on their undertaking. It is unreasonable to desire to share only benefit and relinquish responsibility.
II. Emerging Liability Jurisprudence
As per the international and domestic Environmental law principles, polluter has to pay. If there is a nuclear accident caused by the MNC, it will be that polluter, which has to bear the burden. The expression payment means compensating the loss totally. There are various principles of liability that evolved over a period of time in UK, US and India.
  1. Fault based liability, where the victim has to prove the fault of the wrong doer, while the defendant will get a chance to plead absence of negligence or fault etc.
  2. Strict liability or no fault liability, where the wrong doer will be liable with or without proof of fault by the claimant.
  3. Absolute Liability:  stricter than the strict liability, where person engaged in hazardous and dangerous activity would be liable to pay for every loss. Principle of absolute liability is laid down by Supreme Court in Shriram Gas Leak case: Where an enterprise is engaged in a hazardous or inherently dangerous activity and harm results to any one on account of an accident or in the operation of such hazardous or inherently dangerous activity resulting for example, escape of toxic gas, the enterprise is strictly and absolutely liable to compensate all those who are affected by the accident and such liability is not subject to any of the exceptions which operate vis-à-vis the tortuous principle of strict liability under the rule in Rylands v Fletcher.[9].
  4. Product Liability: Whatever may be the consequence of the use of the product, if that resulted in any loss or harm, it is the bounden duty of the producer of the product to compensate the loss. It is a kind of product related strict liability, which exempts non-interfering middle agencies such as links between maker and seller. (Donogue v Stevenson[10]). If nuclear reactor is defective, and that caused an accident, more than an operator it is the maker or supplier to take up the responsibility of defective product i.e. the reactor and be liable.
On February 14, 1989 the Supreme Court[11], based on earlier settlement, directed the Union Carbide to pay up US $ 470 million in “full and final settlement” of all claims, rights, and liabilities arising out of the disaster in 1984. The entire suit was ordered to be settled with a view to provide ‘immediate and substantial relief to the victims, essentially on the following conditions:
(1)     The Union Carbide Corporation shall pay a sum of US $ 470 million (approximately 750 Crores) to the Union of India in full settlement of all claims, rights and liabilities related to and arising out of the Bhopal Gas disaster;
(2)     All Civil proceedings arising out of the Bhopal Gas disaster shall stand concluded in terms of the settlement and all criminal proceedings related to and arising out of the disaster shall stand quashed wherever these may be pending..
In response to criticism from several quarters, and review petitions were filed by several action groups, the Supreme Court decided in 1991[12] upholding the settlement except the condition of quashing criminal charges. The Supreme Court has set aside the quashing of the Criminal proceedings being not justified and said that those proceedings would continue[13]. The UPA Government’s bill with liability limitations had several clauses against these norms debated during Bhopal litigation.
Unlimited liability: Common law and law of Torts impose liability in tune with the loss as part of civil rights of the people, besides inevitable criminal liability. Over a period of time the tort law gave rise to ‘strict liability’ (Rylands v Fletcher[14]) without expecting victim to prove the fault of wrong doer, and at a later stage, developed a stricter law of liability called ‘absolute liability’ (Sri Ram Gas leak case[15]) where the wrong doers will be asked to pay compensation to all those who suffered because of their dangerous activity irrespective of their diligence, absence of negligence or lack of proof of fault. The legal regime has traveled so long that to go back from these well established norms will be a retrograde step without justification.
Primarily the liability is fault based. But most of the systems under rule of law have already working with ‘strict liability’ or no-fault liability principle to ensure quick realization of compensation from the industries causing disasters. The Supreme Court of India in Sriram gas leak case and other cases has rightly come out with new principle of ‘absolute liability’ where defences are reduced to a bare minimum and proof of negligence is totally done away with.
Supreme Court said in Vellore Citizens Welfare Forum vs Union of India[16]..“once the activity carried on is hazardous or potentially hazardous, the person carrying on such activity is liable to make good the loss caused to any other person by his activity irrespective … whether he took reasonable care….” This absolute liability “extends not only to compensate the victims of pollution but also the cost of restoring the environmental degradation…”
The provisions of liability and limitation on the controversial bill 2010 are in contradiction with the precautionary principle and the polluter pays principles, which are internationally accepted norms. These norms were also upheld and made law by the Supreme Court in relation to fundamental constitutional rights. It is not proper for any body to involve in potentially harmful activities.  Those who indulge in inherently dangerous activity should bear cost of all consequences of accidents, without availing any defences recognized for ‘strict liability’ in Rylands v Fletcher[17] principle. Public Liability Insurance Act, 1991 has codified this absolute liability principle as explained by the apex court, which amounts to legislative validation.
Even in Motor Vehicle Accidents, the liability towards third party is unlimited, which means whatever is the loss caused to third party by the involvement of automobile, the owner will be liable to compensate which of course is done by insurance company through compulsory insurance. After Motor Vehicle legislation, the Public Liability Insurance Act introduced another involuntary insurance for industrial disasters. Thus the law of unlimited liability for inherently dangerous operations is already in operation wherever the Motor Vehicle laws are enforced, it was extended to industry by legislation, and it was effectively evolved and approved by the apex court in India with greater emphasis. The idea of limiting the liability is not in tune with any norms and thus not acceptable. Any industry-specific law imposing liability must provide compensation for every loss covering the maximum possible damage. No such law can limit it to an average or minimum or probable damage for the victims of an accident. An Automobile can spell disaster to the family of victim, who has every right to seek restitution of loss. Motor Vehicle Act provided for it, and also evolved insurance mechanism to realize it. The premium paid to insurance company is no way proportionate to the size of the risk it is going to cover in a year. In spite of increase in number of accidents, the insurance companies are not going bankrupt because the losses and payments are still less in number because of various factors. When it was asked to compensate a particular victim of a particular motor vehicle, insurance company cannot say no. Restitution of the parties to the position prior to accident is the aim of ‘compensation’.  If this norm is fine for motor vehicle accident, why not extend it to cover victims of nuclear accident also?
Limitation on Liability is Unconstitutional: The eminent jurist, and former Attorney General, Soli Sorabjee has explained the legal position and viability of this proposed legislation[18]: Any legislation that attempts to dilute the norms of ‘Polluter Pays’[19] and ‘Precautionary Principle’ and imposes a cap on liability is likely to be struck down as it would be in blatant defiance of the law laid down by the Supreme Court judgments. In Indian Council of Enviro-Legal case[20], the Court ruled that according to this principle;
…once the activity carried on is hazardous or inherently dangerous, the person carrying on such activity is liable to make good the loss caused to any other person by his activity irrespective of the fact whether he took reasonable care while carrying on his activity. The rule is premised upon the very nature of the activity carried on. … It is that the enterprise (carrying on the hazardous or inherently dangerous activity) alone has the resource to discover and guard against hazards or dangers – and not the person affected and the practical difficulty (on the part of the affected person) in establishing the absence of reasonable care or that the damage to him was foreseeable by the enterprise[21].
The apex court also ruled in the above judgment that the responsibility for repairing the damage is that of the offending industry[22] and imposed on the offending industry the obligation for carrying out necessary remedial measures to repair the environmental damage caused[23].
A three judge bench of the Supreme Court in Vellore Citizens’[24] case reaffirmed this point in these terms:
“The Polluter Pays Principle as interpreted by this Court means that the absolute liability for harm to the environment extends not only to compensate the victims of pollution but also the cost of restoring the environmental degradation. Remediation of the damaged environment is part of the process of “Sustainable Development” and as such the polluter is liable to pay the cost to the individual sufferers as well as the cost of reversing the damaged ecology”[25].
Apart from these profound judicial pronouncements, the constitutionally guaranteed rights of people in general also need to be secured. It would be against the interests and the cherished fundamental right to life of the people whose protection should be the primary concern of any civilized democratic government. The Supreme Court reiterated that “the Precautionary Principle and the Polluter Pays Principle have been accepted as part of the law of the land” and referred to Articles 21, 47, 48-A and 51-A(g) of the Constitution. The Supreme Court further held that “the onus of proof” is on the actor or the developer/industrialist to show that his action is environmentally benign”[26].
With regard to measure of compensation also the Supreme Court was very specific: In Shriram gas leak case it said:
We would also like to point out that the measure of compensation in the kind of cases referred to in the preceding paragraph must be correlated to the magnitude and capacity of the enterprise because such compensation must have a deterrent effect. The larger and more prosperous the entire, greater must be the amount of compensation payable by it for the harm caused on account of an accident in the carrying on of the hazardous or inherently dangerous activity by the enterprise.
III. Problematic Provisions of Civil Liability for Nuclear Damage Bill
There are four major problems with the Bill:
  1. It caps the total liability for a nuclear mishap, however serious, at as little as 300 million SDR (Special Drawing Rights), and the liability for the operators of nuclear facilities to Rs.500 crore.
  2. It imposes liability only on the operator, which means statutory exemption to plant designers, manufacturers and suppliers.
  3. It leaves the determination of the occurrence and gravity of a nuclear accident exclusively to the four claims commissions at four zones under Atomic Energy Regulatory Board (AERB), which means a non-judicial executive body, would determine the losses in contradiction to existing law.
  4. It bars the post-mishap period for which the operator is liable to only 10 years. If compared with Bhopal tragedy, as per this Bill, the plant owners (now Dow Chemicals) will not be responsible for continuous damage being caused.
The crucial clause that limits liability is 6 (2) which says: The liability of an operator for each nuclear incident shall be rupees five hundred crores. The Clause 7 (1) provides: The Central Government shall be liable for nuclear damage in respect of a nuclear incident. (a) Where liability exceeds the amount of liability of an operator specified under sub-section of section 6; (b) occurring in a nuclear installation owned by it. Furthermore, the Clause 6 (1) provides: The maximum amount of liability in respect of each nuclear incident shall be the rupee equivalent of three hundred million Special Drawing Rights. It means that in case of the power plants the quantum of “liability” is “three hundred million US $ Special Drawing Rights” or equal to the “maximum” (i.e. total) “liability” of 450 million US $.  The lower quantum of “rupees five hundred crores” will apply only in case of nuclear power plants operated by private companies. As of now, there is no such private plant. Because there are specific provisions referring to operator, it is inferred that there would be private operators in future. Some are apprehensive of the possibility that public sector undertakings alone would be operators and thus the bill imposes liability on operator only. In case the operators are public sector bodies alone, limiting their liability is considered as an appropriate provision.
If the operators are private parties, there are apprehensions about their safety adherence. There is higher number of safety hazards unique to nuclear industry and the nuclear power plants are suspected to be potentially catastrophic, as proved in the Chernobyl Disaster. Will it be proper to hand over such a vulnerable industry with dangerous tendencies of killing people and destroying environment, to private hands with reduced liability law?
There are immunity clauses where the operator is exempted. Clause 5 (1) says operator will not be liable for damage as a consequence of (i) a grave natural disaster of exceptional character and (ii) an act of armed conflict, civil war, hostility, civil war, insurrection or terrorism. Clause 5(ii) offers six excuses for an operator to escape liability. Clause 5(2) says the operator shall not be liable for damage caused to nuclear installation or to any property connected to installation or damage caused to the means of transport upon which nuclear material involved was carried at the time of nuclear incident. The bill also says the operator of a nuclear power plant will be liable for all accidents, including those that occur during the transport of the material. Of course, force majeure occurrences such as armed conflicts, natural calamities, terrorist attacks, etc., are excluded.
The maximum financial liability in case of an accident in nuclear reactors which has been set at the rupee equivalent of 300 million or Special Drawing Rights (SDRs) as per clause 6 is considered meager in comparison to the destruction caused by a nuclear accident. Especially when a similar law in US has set the financial liability for such accident at $10.5 billion, why there should be such a low limit in India? Clause 2(p) of Bill says Special Drawing Rights are as determined by International Monitory Fund. It is very clear as to who will decide the quantum of damages to compensate the damage.
There is further sharing of liability among liable groups as defined by clause 7,  which states that the operator will have to pay Rs. 500 crore and the remaining amount will be paid by the Indian government. By this law the Central Government also undertook to bear the damage from nuclear incident caused by grave natural disaster, or terrorism, or damage caused to nuclear installation owned by it. Because these are defences which immune the operator totally. Does it mean that private operators are free to operate reactors in existing nuclear installations, and cause any damage to those government installations without any fear of liability?
The limits spelt in the Bill would mean immunity to certain sections which are otherwise liable. The clause 17 deals with the liability in case of a nuclear accident. It allows only the operator to sue the manufacturers and suppliers, i.e., victims will not be able to sue them. Combined reading these clauses will lead to an understanding that no one will, in fact, be legally liable because the recourse taken by the operator will yield only Rs. 500 crore at maximum. If written into the contract, the operator can claim the liabilities from the manufacturer and supplier as per that contract. This is purely between the product maker and supplier and operator. But the maximum amount payable by the foreign companies, as per this bill will be limited to a meager sum of Rs. 500 crore.
In sum and substance, this bill envisages to
a)      prohibit the victims to sue operator for beyond Rs. 500 crore,
b)     prohibit operator from getting more than Rs 500 crore from supplier or manufacturer,
c)      prohibit victims from suing suppliers or manufacturers directly,
d)      prohibit the courts of law from hearing the claims, and prohibit the claims beyond ten years from date of nuclear accident.
Mr. Sukla Sen[27] analysed and compared the liability amounts with the Bhopal tragedy saying:
In case of Bhopal Gas Disaster, the Supreme Court had approved a deal between UCC and Union of India providing compensation to the victims amounting to US$ 470 million. That was way back in 1989, more than two decades ago. Even at that time this was considered grossly inadequate. So, while whatever cap on “liability” is unacceptable; this cap on total “liability” or the “maximum amount of liability”, as the draft Bill has put it, is woefully paltry. More so, given the fact that a catastrophic nuclear accident may very well dwarf the Bhopal Gas Disaster in terms of devastations. In case of Chernobyl Disaster, while no precise estimate of total economic impact is available, as per one report, the total “spending [only] by [neighboring] Belarus on Chernobyl between 1991 and 2003 was more than US $ 13 billion.  That’s incomparably larger as compared to the “maximum liability” pegged in the Bill – 450 million US $! The second tier of compensation amounting to Rs. 2,100 crore is to be met by the government.
If we take inflation since 1984 into account, even the Bhopal settlement would be $1.5 billion today – about three times higher than the Bill’s ceiling. Though the Bill allows for the raising or lowering of liability up to Rs. 100 crore, it offers no remedy. Besides, this is an arbitrary power given in the state’s hands. Thus limiting the liability in terms of rupees also does not help the victims and largely benefits an MNC involved in irresponsible operation of the nuclear industry. It makes no sense to let manufacturers and suppliers of nuclear plant and equipment off the liability hook. If defective designs are the root causes of a mishap (as in Bhopal), the designer must be made liable for the consequences of that mishap. Or else, we will end up punishing a subordinate agency, like the Indian subsidiary of Union Carbide, while exonerating the culpable parent[28].
Another point of view is that this legislation is necessary because the Indian Atomic Energy Act of 1962 has no provision for liability or compensation in the event of a nuclear accident even though India operates 18 nuclear power plants.
The Bill provides for increase and decrease also. The Central Government may, having regard to the extent of risk involved in a nuclear installation by notification, either increase or decrease the amount of liability of the operator. Assessing the loss and imposing liability is supposed to be done by an independent adjudicator like court of law or special tribunal in each individual case separately. Giving power to the Government to increase or decrease the amount liability by issuing notification, which again amounts to ‘executive limitation’ on overall size of the liability, which is against principles of justice and cannot work out in actually providing relief and compensation to the victims.
One interesting feature of the Bill is that it recognizes that the consequences of a nuclear accident may not be limited to national borders and provides for liability outside India’s territory too. But it makes no provision for enforcing that liability. It is practically almost impossible to enforce such liability beyond territory. It appears we traveling from progressive statutory absolute liability rule to statutory corporate immunity regime.
Right of Recourse: Although the bill channels all liability for a nuclear accident to the operator of the facility, Clause 17 of the draft allows the operator a ‘right of recourse’ which means the right to recover any compensation it is forced to pay. The Clause 17, inter alia, provides as under: The operator of a nuclear installation shall have a right of resource where (a) such right is expressly provided for in a contract in writing; (b) the nuclear incident has resulted from the willful act or gross negligence on the part of the supplier of the material, equipment or services, or of his employee; and (c) the nuclear incident has resulted from the act of commission or omission of a person done with intent to cause nuclear damage. The clauses (a) and (c) are mentioned in the model law developed by the Convention on Supplementary Compensation for Nuclear Damage (CSC). However the CSC does not prohibit the inclusion of additional provisions. Indeed, some countries have already included gross negligence by suppliers as grounds for invoking the right of recourse in their liability laws. Article 4 of the South Korean Act on Compensation for Nuclear Damage, for example, includes language similar to 17(b) of the Indian draft. Clause 17(b) is needed to deter suppliers from being negligent. Clause 17(a) alone is inadequate since no supplier will agree to accept liability for negligence in a contract. But, surprisingly, the Union government has agreed to delete this key provision.  The Hindu newspaper reported[29] how the U.S. nuclear industry was upset with 17(b) and wanted it deleted for fear it would “open the door to more lawsuits.” The government has obliged the American side by getting rid of this sub-clause entirely[30]. After the uproar against the June 7 judgment of Bhopal trial court in a criminal proceeding leading to paltry punishment to the accused other than UCC and its chief Anderson, the Government of India decided not to delete 17 (b).
Another ridiculous ‘immunity’ provided by the bill to the nuclear radioactive polluters is that victims cannot question them ten years after the accident. The objections raised as regards the 10-year limit to “liability”, as provided in Clause 18 (Chapter IV), are very reasonable and quite valid[31]. In case of exposure to low dose radiations, the injuries caused thereby – mostly in various forms of cancer, may take much longer time to manifest. However, it is very difficult to establish the causal link.

Exclusion of Courts jurisdiction: Clause 35 extends the legal binding that the responsible groups may have to face. The operator or the responsible persons in case of a nuclear accident will undergo the trial under Nuclear Damage Claims Commissions and no civil court is given the authority. The country will be divided into zones with each zone having a Claims Commissioner. This is in contrast to the US counterpart – the Price Anderson Act, in which lawsuits and criminal proceedings are taken up under the US courts.

Disadvantage to US companies?: One general and strong argument that is put forward by the supporters of the bill is that without this kind of law the US companies would be at a disadvantage, and that will affect our nuclear industrial progress. Their disadvantage is correct. The American vendors will be at no disadvantage as compared to their competitors as the vendors are routinely “indemnified for consequential damages”. Even otherwise, the Bill does not prohibit the operator from making the equipment vendor liable on account of an accident. That is between the operator and the vendor. Liability depending upon the operation is something to do with the rights of the people at large that cannot be considered a disadvantage. No nation can allow any operator including Government operator to exempt from liability after causing a disaster through its dangerous operations.
Criminal Liability: Another basic omission in this Bill is mention of criminal liability. As we have seen from Bhopal incident leading to serious public anger at the way criminal prosecution was handled resulting in meager punishment and leaving out the real culprits, it is necessary to specify the criminal liability for causing death with negligence in such hazardous and inherently dangerous activities considering it as culpable homicide not amounting to murder.
Vicarious liability: The Bill should specify absolute liability principle and also impose vicarious liability with specific provisions on the persons including corporations who involved in selecting, designing and sending the technology or product which might have given rise to the dangers of disasters to pay the damages and fix up criminal liability on the overall in-charge of principal MNC. The problem of escaping from liability and imposing liability only on subsidiary or operator must be thoroughly dealt with and the Bill should send across a message to the whole world that third world will not tolerate any more the accidents or disasters and excuses from liability.
India should lead the third world in agitating for vicarious liability of principal companies like UCC headquartered elsewhere over and above liability of the supplier. It should work for a convention and international agreement on vicarious liability of MNCs for the disasters of their subsidiaries in third world. There should be a time limit also within which they have to settle all claims and damage payments to the victims.
Political Opposition: As the essential aspects of the Bill became controversial the United Progressive Alliance could not table the Civil Liability for Nuclear Damage Bill, 2010, on March 15, 2010 with the strong opposition from the Left parties, sections of the Bharatiya Janata Party, other centrist parties and some of the Congress’ own allies. It was referred to a Parliamentary Standing Committee, to analyze it thoroughly and critique the rationale for limiting the liability for accidents in civilian nuclear installations. Earlier, the Union Cabinet has openly ruled out the objections raised by the Finance and Environment ministries indicating that it succumbed to the pressure of the US officials[32]. After the approval a significant change is made in clause 6 (2), where the quantum of “liability of an operator for each nuclear incident” has been revised upwards from “rupees three hundred crores” to “rupees five hundred crores”. A new “Chapter”, ‘Offences and Penalties’ with 4 clauses, has been added. Besides, the Chapter IV, ‘Claims and Awards’, has been somewhat restructured and expanded[33]. The Bill has 7 Chapters with 49 clauses along with ‘Statement of Objects and Reasons’ and ‘Notes on clauses’. The objective of the Bill is explained as: To provide for civil liability for nuclear damage, appointment of claims Commissioner, establishment of Nuclear Damage Claims Commission and for matters connected therewith or incidental there of. Para 7 of the ‘Statement of Objects and Reasons’ further lays down that the purpose of the Bill is: to enact a legislation which provides for nuclear liability that might arise due to a nuclear incident and also the necessity of joining an appropriate international liability regime.
The Bill in the Clause 9 (Chapter III) provides: The Central Government shall, by notification, appoint one or more Claims Commissioners for such area, as may be specified in that notification, for the purpose of adjudicating upon claims for compensation in respect of nuclear damage.
The Chapter IV deals with ‘Claims and Awards’, which is the main part of the law. The clause 6 prescribes the limits of “liabilities”, clause 7 spells out the “liability” of the Central Government and the clause 5 lists out the circumstances under which the “operator” shall not be “liable”. The liability of supplier or producer is totally removed, which amounts to granting immunity to producers apparently a major departure from principle of product liability in strict terms.

Openings to Private Operators: After reading the serious apprehensions as introduction and brief outline of the killer bill let us study the impact of this defective law on this nation.  Today we have a law called Environment Protection Act, 1985 which makes the polluter to pay and imposes on polluter a legal obligation to take precaution. This was strengthened by the most imaginative judicial legislation principle of Absolute Liability laid down by Supreme Court in 1986. These two legal instruments were not available to tackle the Bhopal gas leak tragedy in 1984. Now the situation is different, liabilities are fixed. The Public Liability Insurance Act, 1991 made it mandatory to the hazardous industry to insure the possible damage to people and environment.  For people of India, there is no need for any law to make the hazardous nuclear industrialists liable today. But big energy corporate sector in United States of America and Union of India Government needs to limit the liability or exempt totally wherever possible.

Apparently serving the US and other western corporate interest, the Bill is an open invitation to corporate catastrophes as it envisages and permits the entry of private players as “operators” nuclear power industry. Because of unique nature of nuclear power industry and its catastrophic potentials, as chillingly illustrated by the Chernobyl Disaster on April 26, 1986, provisions of this bill are very dangerous. The fact is that profit-maximization is the very raison d’etre of a private enterprise giving rise to the consequent innate tendency to cut corners in terms of safety measures.
Enforcing liability strictly is what is needed than mere regulation, because regulatory mechanisms can at best only “regulate”. Hence, the envisaged ushering in of private players as “operators” of nuclear power plants has become an open invitation to disaster. Thus validating the private participation as “operator” of nuclear power plants in India is emerging as a big legal controversy. This draft legislation aims at defining the ‘liability’, arising out of any nuclear accident, of an individual “operator” independent of (and unaffiliated with) the Government of India.  At present all nuclear establishments & ventures, power plants are run by the state through affiliated bodies the Uranium Corporation of India Limited (UCIL) for uranium mines and the Nuclear Power Corporation of India Limited (NPCIL) for the power plants. Without specifically laying red carpet for private ‘operators’, the Bill provided for ‘operators’ and their ‘liability’ and at times ‘immunity’ specifically. This indicates possible private operators to come up with state support.
Limiting the total “liability” of the (private) “operator” plus the “state” regardless of the scale of the disaster is the most unreasonable part of the draft law. Generally an enactment aims at imposing liability in the interest of the people who are innocent victims. Strangely this law proposes just unacceptable propositions of reducing the liability and offering immunity, besides legally burdening the state to pay for by foreign nuclear corporate caused disasters.
Defending the Bill: The provisions regarding liabilities are very crucial in this Bill of 2010. The defence of the bill rests on this aspect and on the need for nuclear power to end the scarcity of power. The scientific studies and advances in nuclear technology have significantly reduced the probability of a nuclear catastrophe and thus nuclear power is considered an environment friendly and sustainable source of energy, though environmentalists oppose to agree that it is clean or green energy. The supporters of bill say, however, it is still necessary to keep in mind the possibility of nuclear accidents and other negative aspects of the nuclear energy and measures must be taken for its peaceful use. Substantial part of the controversy is about providing sufficient financial assistance under such circumstances.
Having brought it, naturally the government has defended this civil nuclear liability legislation. Pointing to the fact that only the government or NPCIL runs nuclear power plants in India, said liability of a foreign supplier could be defined by an agreement with the operator. Fixing responsibility in terms of faulty equipment would always be time-consuming and this was why the operator had been made directly responsible for compensation. For liability beyond Rs 500 crore and up to Rs 2,300 crore, a tribunal would assess the compensation to be paid. The Government and other supporters of this Bill as it is, refer to the legislations in other countries offering even lower amounts (the Rs 205 crore prevalent in China and Rs 335 crore in Canada), and $350-600 million in some other countries. As pointed out by Praful Bidwai and many opponents argued, the US had a pooled fund of about $11 billion under the Price-Anderson Act. The United States has displayed its concern for the safety of the US plays a safe game when it comes to its own people and tries to save coffers of its MNCs in relation to disasters in third world. What is that Indian statesman are interested in?
There are certain contentions in favour of the statutory limit on liability.  Prakash Nanda[34], a journalist and editorial consultant for Indian Defense Review says comparing with Bhopal is irrelevant, he wrote:
As regards the limit, the government has said that the amount could be raised. The point to note here is that in India all nuclear power plants are owned by the government, so there is no private motive in limiting the liability in cases of a nuclear accident, which, in any case, is a rarest of rare possibilities. Therefore, comparing the situation with the Bhopal-gas tragedy in 1985 is irrelevant since Union Carbide, owner of the Bhopal plant, was a foreign body (U.S. organization), whereas here the government of India owns the nuclear power plant. And the government can always go beyond the written liability amount by either meeting the excess from its own exchequer or from international sources such as the CSC. It does not make sense to have a high liability amount on paper, since doing so would result in high insurance coverage of the concerned power plant, which would ultimately be reflected in the rate of the nuclear energy it provided to consumers. As regards the second criticism, it is wrong to say that only the Americans are demanding a liability law of this sort. France and Russia, or for that matter any other potential supplier, also want such a law, something Energy Minister has revealed.
Comparison with Bhopal is just to explain the problem of enforcing liability in case of major disasters. A nuclear accident could be very high in its proportion compared to Bhopal tragedy. Without considering these major aspects, the state limits the liability simply to reduce the burden of insurance premium sacrificing the interests and even lives of Indians.  Liability for Bhopal tragedy is not established and not imposed on Union Carbide, which supplied machinery, technology and offered training besides guiding the Union Carbide India Limited totally. Legally the UCIL is shown as separate concern in which the Union of India and Madhya Pradesh state have owned shares along with UCC. The Union of India accepted its share of liability either by offering damages beyond what is given by UC or suffering the losses of the disaster. If the state becomes responsible for the disaster caused by the foreign nuclear firm, it amounts to victims paying for the victims. Whether the nuclear firm belongs to India or a foreign country, responsibility should fall on those who caused it.
Official sources say still there is no problem, as general remedies are not closed by this law. Scope for legal action against a supplier of faulty or unsafe equipment is possible as per clause 46 of the nuclear bill, which says that the Act’s provisions “shall be in addition to, and not in derogation of, any other law for the time being in force.” This will allow the filing of tort claims and even criminal charges in case a nuclear accident is caused by negligence on the part of the nuclear operator or its equipment suppliers. Most of the Torts claims are not pursued here in this country which presents very less possibility of enforcing general remedies.  It is proved that general remedies could not be pressed in Bhopal case. The question is: If the liability is already there in general principles of tortuous liability, why this law is being made? When a special law is passed specifically for nuclear damage, how can a general law apply to nuclear accident?
IV. Liability norms in other countries
Other countries, while implementing the broad principles laid down under international conventions, have framed their own legislative regimes for nuclear liability. They also impose financial security requirements on the operator, which vary from nation to nation.
The Situation in the US: For instance, in the US, the 1957 version of the Price-Anderson Act — the world’s first comprehensive nuclear liability law — prescribed the operator’s liability at $60 million and the government’s share of liability at $500 million. After a series of amendments, the Act currently absolves the State from any liability below $10.761 billion in cover and places the onus entirely on the operator, without any cost to public or government and without fault needing to be proven. Over $200 million has been paid by US insurance pools in claims and costs of litigation since the Price-Anderson Act came into effect, all of it through the insurance pools. Of this amount, around $71 million was related to litigation following the 1979 accident at the Three Mile Island. According to World Nuclear Association data, in mainland Europe, individual countries have their own cap levels.
In US, in the event of an accident, the first $375 million is paid by the insurer(s) of the plant. It is mandatory to insure the plant. Beyond that, up to US$ 10 billion is paid out of a fund jointly contributed by the “operators” as mandated by the Price-Anderson Nuclear Industries Indemnity Act. Beyond that, the Federal Government pays[35]. For US victims of nuclear accidents, they guarantee 10 billion US dollars from a fund of operators, and for the victims in India, US wants reduced, limited and truncated liability for a paltry amount. Does value of life differ from US to India?
In Germany: Germany has unlimited operator liability and requires € 2.5 billion security, which must be provided by the operator for each plant. This security is partly covered by insurance. France requires financial security of € 91 million per plant. Switzerland requires operators to get insurance cover of up to € 600 million. It is proposed to increase this to € 1.1 billion and ratify the Paris and Brussels conventions. In Finland, a 2005 Act requires operators to take at least € 700 million insurance cover, and operator liability is unlimited beyond the € 1.5 billion provided under the Brussels Convention. Sweden has ratified the Joint Protocol relating to Paris and Vienna conventions. The country’s Nuclear Liability Act requires operators to be insured for at least Swedish Kroner (SEK) 3300 million (€ 302 million), beyond which the State will cover to SEK 6 billion per incident.
In Canada, the Nuclear Liability and Compensation Act is also in line with the international conventions and establishes the licensee’s absolute and exclusive liability for third party damage. The limit of Canadian
$75 million per power plant set in 1976 as the insurance cover required for individual licensees was increased to $650 million in the Act’s 2008 revision.
In Japan, China etc: Japan is not party to any international liability convention but its laws generally conform to them. The two laws governing them are revised about every 10 years. Russia is party to the Vienna Convention since 2005 and has a domestic nuclear insurance pool comprising 23 insurance companies covering a liability of some $350 million. It has a reinsurance arrangement with Ukraine and is setting one up with China. China is not party to any international liability convention and has only a 1986 interim domestic law on nuclear liability, which corresponds with international conventions, except that the liability limit is only about $36 million[36].
V. Nuclear Accidents
It is necessary to study technicalities and the possible quantum of damage in nuclear accidents. In any nuclear industry, the maximum accident is a core meltdown: the overheating of the core of a nuclear reactor, the site of fission, due to a Loss of Coolant Accident (LOCA) or some other malfunction. It is the meltdown that caused disaster in Chernobyl (1986) Even the Three-Mile Island (1979) tragedy was a LOCA. But that was not led to meltdown. But meltdown cannot be ruled out altogether, until 2007, it was pointed out by newspapers and journals that the global nuclear power industry recorded more than 60 serious accidents and many of them were LOCAs. A LOCA can within seconds produce an uncontrollable chain of events. The danger is especially high in certain reactor types that have a positive void coefficient of reactivity. Simply put, this describes the reactor’s tendency to get progressively hotter when bubbles form in the coolant. This can have grave consequences. The natural uranium-heavy water-based CANDU design, the mainstay of India’s nuclear programme, has such a positive coefficient, according to Praful Bidwai[37].
What happens when there is a nuclear accident? Even if one of 430 operating commercial nuclear reactors can undergo a core meltdown, it would release vast amounts of radioactivity. The radioactivity, carried in dust clouds, can spread over hundreds of kilometres depending on the wind direction and speed. Such a spread of radioactivity to distant places will have a far reaching effect. It is inevitable to refer again to the worst example in Chernobyl accident, wherein leaked radioactivity made thousands of sheep in faraway Scotland and reindeer in northern Sweden, non consumable as they had fed on radioactively contaminated grass, and thus they had to be slaughtered.  Explaining the disaster that can spell serious damage to India, Praful Bidwai wrote:
A Chernobyl-like accident (1986) will wreak damage upon human and animal life, the environment and the infrastructure running into hundreds of billions to several trillions of dollars, and make huge swathes of land uninhabitable for centuries. The initial damage from the reactor-core meltdown in Chernobyl was estimated by the Ukrainian government at $250 billion. It may turn out even higher as more cases of cancer and genetic damage come to light, necessitating expensive treatment. German researchers estimate that a Chernobyl-type accident in Germany will cause damage in the range of 2 trillion to 5 trillion euros, which equals the entire annual gross domestic product of the world’s third biggest economy, and until recently, its topmost exporter. ….An estimated 65,000 people perished in the Chernobyl accident. And the death toll mounts every month. This is more than three times the number killed in Bhopal. An Indian Chernobyl could conceivably kill even more given our cities’ high population density. Such estimates are in line with forecasts made in the mid-1970s by United States Nuclear Regulatory Commission-sponsored studies with 3,300 early deaths plus 45,000 early radiation-related illnesses. More recent estimates are higher and run into scores of billions of dollars. It makes no ethical, technological or practical sense to subsidize nuclear power by extinguishing the liability burden or transferring it to the public[38].
It is impossible to imagine that the damage from an Indian reactor-core meltdown will be less severe. Even lesser accidents such as spills and leaks of nuclear material during transportation and handling, loss-of-coolant accidents (LOCAs), other radioactivity releases, and overexposure of the public to emissions and effluents containing dangerous material can cause grave damage. With our industrially safety norms, mostly violated and the history of industrial disasters, the nuclear radioactivity leak or meltdown would have a very serious impact on human life, animals and environment.  Referring to Charles Perrow’s classic Normal Accidents; Basic Books, 1984, Praful Bidwai explained: Nuclear technology is extremely hazardous, indeed uniquely so: it is the only mode of energy generation capable of catastrophic accidents. Nuclear reactors concentrate within a small volume large quantities of fissile material, equivalent to several hundred multiples of the critical mass needed to make a nuclear bomb – and hence a high energy density. Their core must be cooled effectively and without interruption so that it does not overheat, potentially leading to a runaway reaction. That apart, all nuclear power generation based on existing reactor designs is inherently hazardous because, as organization theory puts it, it involves large, complex systems within which various subsystems are tightly coupled, leading to a rapid transmission of a problem event to the entire system and hence to catastrophic accidents. The probability of catastrophic nuclear accidents is admittedly low. But their consequences are extremely large, indeed unacceptably so. Praful Bidwai[39] wrote further:
According to a post-Chernobyl study by an independent expert body, Gruppe Ökologie (Germany), all existing reactor types have safety problems, many have had LOCAs, and are vulnerable to all kinds of mishaps that can produce a catastrophic accident. Very few new reactors have been built in the developed countries since Chernobyl. No nuclear reactor has been ordered in the U.S. since 1973, even before Three Mile Island (1979). This has severely limited safety innovation.
Two new designs – Westinghouse’s AP-1000 and Areva’s European (since pompously renamed Evolved) Power Reactor – have just emerged. These are claimed to be “Generation III-plus” and safer than the designs of the 1970s. But they have run into problems with regulatory authorities in the U.S., France, the United Kingdom and Finland, where the first fully market-driven nuclear project in Europe is now in progress – three-and-a-half years behind schedule and with 60 per cent over budget. Scrapping the Olkiluto project will produce a potentially fatal setback to the global nuclear industry.
At any rate, the none-too-happy story of nuclear safety warrants a liability compensation regime which is strict and based on the polluter pays principle and the precautionary principle. That alone can provide the nuclear industry the incentive to redesign reactors for greater safety and operate them with abundant caution. The Bill does the opposite by lightening the nuclear industry’s responsibility by Rs.1,800 crore to compensate the victims of a nuclear accident.
Another critical analyst Shobhana Saxena[40] wrote in Pak Observer: The Gulf of Mexico slick threatens the fishing industry, thousands of jobs, tourism and marine life in the coastal American states. The tragedy is that President Obama’s effort to raise the liability cap to $1.5 billion failed as the Republicans in the Senate didn’t allow the bill to be tabled. The Obama administration wanted to increase from $1 billion to $1.5 billion the amount that could be spent from an emergency cleanup fund paid with industry fees, and raise a $75 million liability limit BP would bear for costs not directly connected to cleaning up the spill, such as lost wages and tourism. Even as Obama licks his wounds, the real tragedy is unfolding in India where the government is again trying to push through the controversial nuclear liability bill. It’s a cruel truth that when an industrial disaster happens in the US, the government of that country doesn’t allow the MNC involved go scot-free. In the Gulf of Mexico accident just 11 people died, but the US government it trying to force BP to pay for everything – deaths, damages and lost wages.
Did we learn any thing from Bhopal? Though in principle, there is criminal liability for killing the people with gross negligence, it is almost impossible to procure presence of the head of MNC who caused the disaster. Best example cited could be Bhopal tragedy and failure of Indian system to bring in Warren Anderson, Chief of Union Carbide Corporation. The verdict of a Chief Judicial Magistrate, Bhopal on 7th June 2010, holding eight officers of UCIL guilty after 26 years of tragedy speaks volumes of the tragic consequences of tragedy. In the whole episode, it is not properly examined as to what crime the offenders would be charged with? Is it murder, culpable homicide not amounting murder or merely causing death by rash and negligent act?
The second question is about civil liability, which is equally complex and totally depends upon the international cooperation. In Bhopal the achievement in this front is neither ideal nor acceptable. But that remains a reality. It is once again manifested that our governments do not learn from experience. Bhopal should have strengthened our commitment, law and enforcement mechanism. No doubt that Bhopal experience gave us a comprehensive environmental policy, but it failed to help developing a legal regime of imposing liability on MNCs.  It is beyond any sane understanding capacity that with a tragic experience of Bhopal genocide caused through pesticide factory by Union Carbide, how India is signing this suicidal pact and what for. All the law of Globalization is a major disaster as that could not secure the lives in Bhopal and could not make the Union Carbide of US liable for its wrongs. The strange technical argument that Union Carbide has nothing to do with Bhopal Disaster is still a problem India faces in its efforts to nail this MNC. It has thrown total responsibility on the Indian special purpose vehicle ‘Union Carbide India Limited’ in which Government of India and Government of Madhya Pradesh were also share holders. More than the profit or benefit, these two governments shared the tragic load more than any body that caused it. The Government of India with its bankrupt mindset argued before US District Court that India had not developed a mature administration of justice system and judiciary here was not mature enough to deal with such massive liability litigation. It is a shame. Marc Galanter, an author and advocate represented India and filed the affidavit signed by Government of India, claiming immaturity of system to provide answer to Bhopal claim. It is ultimately Indian system that came to rescue of Indian victims and not any other law. Now the government is destroying efficiency of legal system by bringing in such a ‘legal disaster’ wherein the nation surrenders its right to claim for future disasters by multinational companies to give them ‘free hand’ to establish nuclear power houses and sell that power to a big market called ‘India”.
Disaster and Compensation: An estimated 8,000 people died immediately and another 12000 thereafter, when Union Carbide’s pesticide plant in Bhopal spewed deadly cyanide gas on the night of Dec. 24, 1984. Tens of thousands of others who were maimed were largely left to fend for themselves or paid inadequate compensation. Around 5 lakh affected and remain victims for ever, two generations scarred, and the air, soil and water of the city poisoned forever. How much they got in compensation: $470 million, a ridiculous amount. In 1999, Bhopal survivors filed a class action suit in U.S. courts against Union Carbide, asking that the company be held responsible for violations of international human rights aw and for the cleanup of environmental contamination in Bhopal. Nothing tangible could happen in US and the litigation came back to India and it was ultimately a settlement but not adjudication. The counsel of Union of India and Union Carbide heeded the advise of the Supreme Court to end the possibly a prolonged legal war, which might not help a suffering victim.
After purchasing Bhopal industry the Dow Chemicals has refused to accept responsibility for the tragedy or pay proper financial compensation. Strangely, Dow spent $10 million on an advertising campaign to fix their image but offered less than a million to help the people of Bhopal. On the 20th anniversary of the disaster, Bichlbaum went on British TV to claim that Dow chemicals was belatedly accepting all the blame for the incident and would reimburse the people of Bhopal by selling off shares of the company and donating $12 million to the people affected.
Although the stunt was quickly revealed as a hoax, the result was that Dow Chemicals lost $3 billion dollars in less than a half hour during a frantic stock sell-off that followed the faux announcement.
The Union Carbide could get away lightly after causing the world’s worst industrial tragedy at Bhopal. The government is aware of all that difficult and protracted process to get 470 million dollars as compensation from Union Carbide, which is one-fifth of the amount required to look after the health of those affected by the Bhopal gas leak and take care of the environmental damage it left behind. Compare this with fraudulent nuclear liability Bill the government is trying to impose on this country. The Bill, in its present form, seeks to limit all liability arising out of a nuclear accident to about $450 million and the liability of the operator only to Rs 300 crore. The difference between $450 million and Rs 300 crore (about $67 million) is the government’s liability.
Considering India’s population density (even stampedes at temples leave hundreds dead every year) and poor industrial safety record (radioactive material can be found in scrap markets), a nuclear accident can cause immense damage both in terms of loss of human life as well as environmental destruction.
The Bhopal case is regarded as a proof of international corporate ‘immunity’, instead of liability, where corporations use the laws of one nation to evade responsibility in another. With all this experience, the leaders of this country proposed under this nuclear liability bill to immune a nuclear equipment supplier from any victim-initiated civil suit or criminal proceedings in an Indian court or in the home country.
When the civil liability is truncated by Government itself, it is almost impossible to visualize making guilty criminal liable and sent to jail. The successive governments have not shown any desire to get Warren Anderson, the criminal-in-chief of Bhopal tragedy, extradited from New Jersey, where he has been living in a mansion. When he visited Bhopal after the tragedy he was given a red carpet welcome and farewell too at airport after getting a few papers signed, might be warrant of arrest and release on bail. The criminal case first conceded to be withdrawn as a term of settlement, but after admonition from Supreme Court the trial went on till recently and judgment was reserved by the trial court in Bhopal without personally hearing Warren Anderson. There is no surprise if the trial ends in finding local managers guilty of the ghastly crime with one or two comments on the masters of disaster.
VI. International Law of Nuclear Liability
Liability for Nuclear disasters is explained in four conventions. They are: 1. The International Atomic Energy Agency’s (IAEA) Vienna Convention of 1963 (since 1977); 2. The Organization for Economic Co-operation and Development’s (OECD) Paris Convention on third party liability in the field of nuclear energy of 1960 (since 1968); 3. Brussels Supplementary Convention of 1963; 4. Convention on Supplementary Convention (CSC) 1997. The very low liability levels which were started with the Paris Convention of SDR 5 million, or €6 million, to SDR 175 million (about €210 million) were adopted by the Brussels Convention. However, by the 1982 Protocol, those levels were raised to SDR 300 million. In 1997, the Vienna Protocol and the Convention on Supplementary Convention (CSC) marked increased limits and set up a somewhat extensive, but still limited, definition of nuclear damage altered to include preventive steps and environmental reinstatement, and changes such as allowing compensation to residents of non-Contracting Parties and making 300 million DRs (about €360 million) the minimum amount that State Parties must make available under national laws, and the CSC would provide for a supplementary fund.53 On the basis of installed nuclear capacity, the CSC provides for additional funds to be made available through contributions by State Parties collectively and a UN rate of assessment. Although the CSC is not functional yet and is not going to come into force anywhere in the near future, whether or not a State is party to any existing nuclear liability convention or has nuclear installations on its’ territory, it may adopt to the CSC[41].
The expression “appropriate international liability regime” in objective statement of the Bill clearly refers to ‘Convention on Supplementary Compensation for Nuclear Damage’ (CSC) 1997, which is based on the earlier Paris and Vienna Conventions. India is not a signatory to these Conventions, and the CSC has not come into force. Before India is considered for membership of this convention, it has to bring a national law in compliance with it. While the CSC provided for absolute liability of the operator, that is the operator would be held liable irrespective of its fault, the Bill provided for contrary to it. The concerned Clause lists out the circumstances under which the “operator” will not be “liable” in case of an accident. This is also in contradiction to the accepted norms of jurisprudence in democratic countries. International Environmental law also did not provide any such exemption to operators whose industry caused a disaster. It is highly unjustifiable to include such a clause in clear departure from CSC and other basic law. Even if India becomes a signatory of CSC it would not harm the interests of the people as that provided for absolute liability. The Bill has stipulated immunity to industries in certain cases, besides limiting their liability. The range of implications of joining this Convention, the main purpose of which appears to make  Supplementary Compensation available jointly by the member countries in case of a (catastrophic) accident over and above the “liability” limit of the “operator” and the concerned state also need be thoroughly examined.
Sukla Sen[42] pointed out: The mainstream, and also radical, critics, known to be otherwise knowledgeable, have rather pitiably missed the central point that the essential thrust of the Bill is to enact a law defining “civil liability” in case of “nuclear damage”, in compliance of the CSC, and usher in private players as “operators” and peg their “liability” at ridiculously low levels, going much beyond the framework of the CSC.  The CSC does not obligate a member state to open up its womb to private players nor does it compel the “liability” to be pegged at a level below SDR 300 million.
Of the 30 countries that operate 436 nuclear power plants, 28 countries, with 416 such plants, have some sort of nuclear liability act in force in their territories. Only India, which operates 18 nuclear power plants, and Pakistan, which has two, are neither members of any international convention nor have any national legislation. But then, India, unlike Pakistan, has a big plan for augmenting nuclear energy.
There must be a national law or bilateral arrangement or international liability regime such as the Vienna-based Convention on Supplementary Compensation for Nuclear Damage[43] or the Paris Convention on Third Party Nuclear Liability in the Field of Nuclear Energy – for the exporter and importer to manage the liability in case any nuclear accident takes place. India is not a signatory to the Convention on Supplementary Compensation (CSC) for Nuclear Damage, which was adopted in 1997, seeks to provide complete protection for nuclear equipment suppliers. But the CSC has so far been ratified by just four countries – the United States, Argentina, Morocco and Romania. Devised by the Vienna-based International Atomic Energy Agency, the CSC comes into force after at least five countries with a minimum installed nuclear capacity of 400,000 megawatts ratify it.
This Bill is claimed to have been made as per on two nuclear liability conventions of the early 1960s, the “Convention on Third Party Liability in the Field of Nuclear Energy”, or the Paris Convention of the Organization for Economic Cooperation and Development (OECD), and the Vienna Convention on Civil Liability for Nuclear Damage of 1963 under International Atomic Energy Agency (IAEA) auspices.
These conventions limited nuclear liability because nuclear power was believed to have unlimited potential for public welfare. Sixty years on, nuclear power has comprehensively belied its early promise. It is far more expensive (about twice as costly as) than electricity from fossil fuels or even renewables like wind. It is inappropriate for developing-country grids that have large peaking-power requirements. And it bristles with safety problems – from radiation exposure of occupational workers, routine radioactivity releases, LOCAs, and problems posed by high-level wastes, which remain hazardous for thousands of years. Besides, many renewable energy sources have since evolved impressively, demolishing the no-alternative-to-nuclear-power claim. The global nuclear industry, working through the IAEA, recently sponsored the Convention on Supplementary Compensation (CSC) for Nuclear Damage which works within the Paris-Vienna framework but doubles the maximum compensation, to $986 million. The global nuclear industry, working through the IAEA, recently sponsored the Convention on Supplementary Compensation (CSC) for Nuclear Damage which works within the Paris-Vienna framework but doubles the maximum compensation, to $986 million[44].
Science and Technology Minister of Government of India claimed that the CSC was tried and tested, widely respected international treaty “the international regime for compensation payment in case of nuclear accidents”. But the reality is otherwise. Since it was opened for signature in 1977, the CSC has only been signed by 13 states and ratified by only four countries (Argentina, Morocco, Romania and the U.S.) – in place of the minimum of five countries needed for its entry-into-force. Most of the developed countries have passed their own domestic laws on nuclear liability. Their compensation levels are not as sordid as the CSC’s. States like Germany, Austria and Sweden laws did not place any cap on liability. Even the U.S. has a corpus fund of $10.7 billion for compensation. This CSC exists only on paper.
In his analysis Sukla Sen further pointed out the difference between the CSC and our Bill, saying: However, once India joins the CSC, and it comes into force, the cap on total “liability” would undergo significant change as additional compensation over and above 300 million SDR would become available. In fact the CSC also permits the concerned states to provide for further compensation, without any “cap”. There must not be any overall “cap” on the quantum of compensation to potential victims. That is too unjust and inhumane. The CSC, as explained above, does not impose any such obligation to limit or cap the liability. It also does not obligate entry of private “operators”. Natural justice demands that it has to relate to the actual damages caused. The overall “cap” of 300 million SDR, which works out to about 460 million US$, is even lower than the compensation amount of US$ 470 million ratified by the Indian Supreme Court to the victims of Bhopal Gas Disaster way back in 1989[45].
VII. Conclusion: Draft Law in Breach of Law
The Sovereign Republic of India in its 60th year of Constitutional Rule of Law is reinventing the liability jurisprudence to detriment of people and for the benefit of MNCs. It can also be condemned because it promotes all terms of MNCs at the cost of people and future generation. The bill is virtually the Corporate Immunity for National Damage Bill 2010. It appears that Indian political rulers are apprehending post-nuclear-accident-trauma of foreign corporate bodies and scripting a legal remedy as a sequel to nuclear disaster if happens at all. ‘King can do no wrong’ was an old British maxim about sovereign immunity in tort (civil wrongs) law. But for modern India, the new maxim is ‘MNC can do no wrong’.  The jurists and activists are questioning why the state should take responsibility for the damage which might be caused in nuclear accidents resulting from nuclear reactors by enacting self-imposing liability legislation? Whether India is trying to curry favour of US companies by this law, just to secure foreign direct investment or foreign technology and the nuclear reactors to India to increase the generation of nuclear power in future?
In 1999, soon after the second Pokhran tests, the Vajpayee government initiated the process of India joining the CSC for Nuclear Damage, which is the international regime for compensation payment in case of nuclear accidents. Simultaneously, the Vajpayee government set up a committee to study the nuclear liability regime. This committee produced a report in November 2001, which said that the Atomic Energy Act was silent about liability and compensation in case of nuclear accidents and that it was time to have a legal mechanism to clarify liability in case of nuclear accidents and join the international treaty regime for nuclear liability.
It is claimed that the IAEA is an impartial body as regards nuclear safety or regulation, its very charter commits it to promote nuclear power on the presumption that it is safe and economical. This agency has refused to involve another United Nations agency, in particular the World Health Organisation with its strong health mandate, in assessing the damage from Chernobyl. For years, it blatantly claimed that less than 30 people died in the accident – primarily firemen[46].
Here it is pertinent to keep in mind that the CSC does not establish either a floor or a ceiling on the liability of the operator or require the concerned state to limit the liability of the “operator”. It in no way makes it incumbent upon any member country to either bring in private “operator” or limit/cap its “liability” at a level lower than the “total liability” (of minimum 300 million SDR)[47]
Sidhartha Varadarajan, wrote in The Hindu[48] quoting the responses of American nuclear industry representatives. Speaking on background because of the sensitivities involved, an American nuclear industry source told The Hindu, “CSC Annex Article 3.3 says, ‘The liability of the operator for nuclear damage shall be absolute’… [But] the draft India bill has no provision making the operator absolutely liable, as required by the CSC.” This objection assumes significance in the light of claims made by senior Indian officials in briefings to the media and political parties that the Rs. 500-crore cap applies only to “no-fault liability.” Nuclear operators and their suppliers would continue to be exposed to claims of tortious liability — liability for damages caused through some fault of theirs — by Indian victims in the event of an accident. Indian officials cited Article 46 of the bill — which says the liability law will not take away from the provisions of the existing laws allowing action in the event of a nuclear accident — and reiterated the government’s willingness to make the bill’s provisions more explicit. They said the Article 35 exclusion of civil courts jurisdiction applied only to claims arising out of a ‘no-fault liability’. Civil courts would remain fully empowered to hear tort claims. On his part, the American nuclear industry source also identified the ‘right of recourse’ granted to nuclear operators by the Indian bill against suppliers as a major problem area. Article 17(b) of the bill — first highlighted in The Hindu— allows the operator to sue his supplier for recovery of any damages he is forced to pay if a nuclear accident results from “the willful act or gross negligence on the part of the supplier of the material, equipment or services, or of his employee.”
“Like the lack of absolute or strict liability, 17(b) is inconsistent with the CSC, as well as the Paris and Vienna Conventions and the nuclear liability laws of every other country with a nuclear power programme,” the U.S. nuclear industry source said.
The American source also found fault with Article 46. “If this article means the operator would not be exempt from any other proceedings [other than criminal liability], that too would be inconsistent with the CSC requirement for exclusive operator liability. CSC Annex Article 3.9 provides, “he right to compensation for nuclear damage may be exercised only against the operator liable … The draft bill has no such provision channelling liability exclusively to the operator.”
While the Obama administration has not said anything to India about these “problem” clauses, Indian officials say they are aware that the nuclear industry association in the U.S. is beginning its lobbying drive. “They have held a meeting and it is only a matter of time before Washington raises this with us,” an official said. “But they are also in a bind. After all, the Indian law is consistent with the CSC. But that doesn’t mean we have to give up our rights under tort law and common law.”
When basic principles such as liability to the extent of damage caused which is conveniently transferred to insurer under a risk management mechanism, polluter shall pay and no harm rule reflected in International Environmental Law, how can some conventions force the states to agree to cap the liabilities which stand to no reason or logic?. While the philosophy of sustainable development is universally agreed, how can any convention or law give primacy to development to the global environment and lives of people?
If the above referred conventions contradict other conventions of environment and sustainable development, the law proposed by India is further dilution of both international and municipal law of liability. The Bill virtually says ‘you do what ever you want and just do not pay more than 500 crores of rupees’. We are making a solemn promise that we do not make any body other than local company liable for any disaster caused by any reactor sold by any country.  In one word the civil nuclear liability bill is a suicide pact with a promise of no liability. It is against all basic norms of international or national liability for wrongs perpetrated against human beings and humanity at large. Why should people of India guarantee benefit, profit and cover all the losses in favour of wrong doing nuclear power MNCs?
Is it a draft law aiming at limiting liability only to operator and awarding immunity to producer or any other player? How far it is proper to offer legal immunity or reduce the liability to those who install nuclear reactors which can cause nuclear dangers in its general operations? It is pathetic that we offer in golden plate the lives and golden environment of this great country to international corporate thugs in the name of ‘energy development’.  This bill is in the form of a pledge that we do not make any claim against suppliers and producers of defective nuclear reactors, and not claim beyond Rs.500 crore from operators even if thousands of us are killed and valuable environs are destroyed. The liability jurisprudence evolved from fault-based liability to no-fault liability emerging into absolute liability. This bill proposes retrograde law limiting liability in general and granting absolute immunity to some, imposing liability on the state itself in brazen violation of international liability norms, Constitutional principles, profound judicial pronouncements and environmental enactments.
What cannot be included in agreement, in the interest of people and the environment, is being made into a law. A government elected for five years, is attempting to inflict a permanent damage on coming generations depriving their right to remedy and to full compensation to the damage suffered.
For these reasons, this Civil Nuclear Liability Bill should not become law in present form. Better we do not have any law in its place because this bill is a manifestation of unreasonable bias towards the global nuclear industry and commerce with scant regard for human life in India. The purpose of making law is to provide for enforceable remedies but not to deny the remedies which were developed over a period of time. This Bill is denial by ‘law’ of decent compensation to the suffering public. Even if there is strong law, there is no possibility of enforcement bending Indian big industry to abide by it. But our existing law is not that strong and leaves so many problems and thus it does not work against a strong MNC which is beyond the jurisdiction of India. Instead of making a strong law making the makers, suppliers and operators liable jointly and severally for the cumulative loss of life, property and environment, by defining vicarious liability of principal companies for the damages caused by their subsidiaries and imposing criminal liability with specific legislative frame, state chose to deny what is already available to people under un-codified principles of liability developed by Supreme Court of India. When the law itself allows openly an unreasonable limit on ‘operator’ and absolute immunity on ‘supplier’ or ‘Parent Corporation headquartered elsewhere, what kind of justice it can render to the future victims of possible nuclear accidents?  If tested on what our Constitution and judiciary laid down over a period of time, the Act of this nature cannot stand scrutiny of the constitutional court.
Finally, this bill is totally unwarranted and good if withdrawn. If the Government has a strong will to provide perfect systems of liability and remedies, there should be a comprehensive law to impose civil liability on principal companies, manufacturers along with operators. Absolute liability norms which are scattered in judgments and various laws or rules should be codified into law. Following is the table of demerits of the Bill and suggestions to remove the damage going to be caused by the Bill.
The Damage Bill 2010
To remove the Damage by the Bill
S 1(3) Bill extends to Territorial Waters, Continental shelf, Maritime Zones, on board Ships and Aircrafts and artificial islands.
With various limitations on liability provided in other sections, this extension becomes meaningless.
s 2(f) defines nuclear damage in extensive terms. Covers human, property, economic, environmental losses and costs of preventive measures too.
2 (f) “nuclear damage” means—
(i) loss of life or personal injury to a person; or
(ii) loss of, or damage to, property, caused by or arising out of a nuclear incident, and includes each of the following to the extent notified by the Central Government;
(iii) any economic loss, arising from the loss or damage referred to in clauses (i) or (ii) and not included in the claims made under those clauses, if incurred by a person entitled to claim such loss or damage;
(iv) costs of measures of reinstatement of impaired environment caused by a nuclear incident, unless such impairment is insignificant, if such measures are actually taken or to be taken and not included in the claims made under clause (ii);
(v) loss of income deriving from an economic interest in any use or enjoyment of the environment, incurred as a result of a significant impairment of that environment caused by a nuclear incident, and not included in the claims under clause (ii);
(vi) the costs of preventive measures, and further loss or damage caused by such measures;
(vii) any other economic loss, other than the one caused by impairment of the environment referred to in clauses (iv) and
(v), in so far as it is permitted by the general law on civil liability in force in India and not claimed under any such law, in the case of sub-clauses (i) to (v) and (vii) above, to the extent the loss or damage arises out of, or results from, ionizing radiation emitted by any source of radiation inside a nuclear installation, or emitted from nuclear fuel or radioactive products or waste in, or of, nuclear material coming from, originating in, or sent to, a nuclear installation, whether so arising from the radioactive properties of such matter, or from a combination of radioactive properties with toxic, explosive or other hazardous properties of such matter;
Because this definition covers almost all imaginable losses, it leaves no scope for any body to claim a relief or compensation. Good definition, but because of limitations and exemptions provided in other sections does not serve purpose.
Limitations should be removed and every element of nuclear damage has to be compensated.
Definition of “nuclear damage” covers “impaired environment”.
There is no provision as to who can lodge claims for “costs of measures of reinstatement” as mentioned therein.
Any public spirited group or citizen, apart from public bodies like Gram Sabha, panchayat, municipality etc. and affected persons, must be entitled to raise such claims.
S 3: Atomic Energy Regulatory Board shall notify nuclear incident.
3. (1) The Atomic Energy Regulatory Board constituted under the Atomic Energy Act, 1962 shall, within a period of fifteen days from the date of occurrence of a nuclear incident, notify such nuclear incident:
Provided that where the Atomic Energy Regulatory Board is satisfied that the gravity of threat and risk involved in a nuclear incident is insignificant, it shall not be required to notify such nuclear incident.
It shall notify every incident causing damage and accident causing serious damage. Whether damage is substantial or not, there is a duty to compensate every loss. Word ‘Accident’ be added and Proviso be removed. Non-notification shall be considered as dereliction of duty and penal consequence should be prescribed
Any private citizen, or group, should have the right to draw the attention of the AERB to an alleged “incident’ in case it is not notified by the AERB suo moto. The AERB shall duly examine and respond to such request.
S 4. Liability of operator.
4. (1) The operator of the nuclear installation shall be liable for nuclear damage caused by a nuclear incident —
(a) in that nuclear installation; or
(b) involving nuclear material coming from, or originating in, that nuclear installation and occurring before —
(i) the liability for nuclear incident involving such nuclear material has been assumed, pursuant to a written agreement, by another operator; or
(ii) another operator has taken charge of such nuclear material; or
(iii) the person duly authorized to operate a nuclear reactor has taken charge of the nuclear material intended to be used in that reactor with which means of transport is equipped for use as a source of power, whether for propulsion thereof or for any other purpose; or
(iv) such nuclear material has been unloaded from the means of transport by which it was sent to a person within the territory of a foreign State; or
(c) involving nuclear material sent to that nuclear installation and occurring after—
(i) the liability for nuclear incident involving such nuclear material has been transferred to that operator, pursuant to a written agreement, by the operator of another nuclear installation; or
(ii) that operator has taken charge of such nuclear material; or
(iii) that operator has taken charge of such nuclear material from a person operating a nuclear reactor with which a means of transport is equipped for use as a source of power, whether for propulsion thereof or for any other purpose; or
(iv) such nuclear material has been loaded, with the written consent of that operator, on the means of transport by which it is to be carried from the territory of a foreign State.
This section explains various kinds of situations wherein liability arises but proviso states that liability is limited as prescribed by section 6.
Liability of operator should be joint and several along with makers and suppliers including principal companies.
To be further added:
The operator shall deposit a sum of 300 million SDR in an escrow account for each nuclear reactor to be operated before start of operation.
S 4(2) Joint liability of all operators.
Section 4 (2) Where more than one operator is liable for nuclear damage, the liability of the operators so involved shall, in so far as the damage attributable to each operator is not separable, be joint and several: Provided that the total liability of such operators shall not exceed the extent of liability specified under sub-section (2) of section 6.
(3) Where several nuclear installations of one and the same operator are involved in a nuclear incident, such operator shall, in respect of each such nuclear installation, be liable to the extent of liability specified under sub-section (2) of section 6.
Explanation.— For the purposes of this section,—
(a) where nuclear damage is caused by a nuclear incident occurring in a nuclear installation on account of temporary storage of material-in-transit in such installation, the person responsible for transit of such material shall be deemed to be the operator;
(b) where a nuclear damage is caused as a result of nuclear incident during the transportation of nuclear material, the consignor shall be deemed to be the operator;
(c) where any written agreement has been entered into between the consignor and the consignee or, as the case may be, the consignor and the carrier of nuclear material, the person liable for any nuclear damage under such agreement shall be deemed to be the operator;
(d) where both nuclear damage and damage other than nuclear damage have been caused by a nuclear incident or, jointly by a nuclear incident and one or more other occurrences, such other damage shall, to the extent it is not separable from the nuclear damage, be deemed to be a nuclear damage caused by such nuclear incident.
It explains in detail the liability of the operator and discusses in minute aspects the liability of separate operators, and says where separation is not possible the liability is joint and several. Again it is limited by a cap in section 6.
Makers and suppliers should be added for imposing liability.
S 5.  Liability and immunity of operators.
5. (1) An operator shall not be liable for any nuclear damage where such damage is caused by a nuclear incident directly due to—
(i) a grave natural disaster of an exceptional character; or
(ii) an act of armed conflict, hostility, civil war, insurrection or terrorism.
(2) An operator shall not be liable for any nuclear damage caused to—
(i) the nuclear installation itself and any other nuclear installation including a nuclear installation under construction, on the site where such installation is located; and
(ii) to any property on the same site which is used or to be used in connection with any such installation; or
(iii) to the means of transport upon which the nuclear material involved was carried at the time of nuclear incident:
5 (1)(ii) should be removed. This should be absolute liability. Only possible exception is grave natural disaster.
Immunity under 5(2) is meaningless, why should installation suffer from the acts of operator, without any remedy of compensation?
This immunity should be removed.
The corresponding CSC clause – Annex, Article 3, 5. b. – provides that national law may have provision to drop such circumstances from the list of exceptions. Cl 591)(ii) does not figure in the corresponding CSC clause: Annex, Article 3, 5. a.
The concept of “strict liability” being the foundational concept, such exceptions, and consequent transfer of liability for damage under such circumstances to the “Central Government”, and thereby to the Indian taxpayers, in case of a private operator, is wholly undesirable and unjustified.
Proviso to Section 5 Liability
Provided that any compensation liable to be paid by an operator for a nuclear damage shall not have the effect of reducing the amount of his liability in respect of any other claim for damage under any other law for the time being in force.
Securing liability under other law is good. But how many proceedings that law will allow for claiming damages. Because of rule that one cause of action arises out of one wrong,, this provision may not help the victims. This law prohibited other actions for claiming damages other than under this law.
Section 5 (3) Where any nuclear damage is suffered by a person on account of his own negligence or from his own acts of commission or omission, the operator shall not be liable to such person.
This is against the norms and principles of compensation as prescribed under Workmen’’ Compensation Act, 1923.
This has to be removed.
S 6. Capping liability
6. (1) The maximum amount of liability in respect of each nuclear incident shall be the rupee equivalent of three hundred million Special Drawing Rights.
(2) The liability of an operator for each nuclear incident shall be rupees five hundred crores:
Provided that the Central Government may, having regard to the extent of risk involved in a nuclear installation, by notification, either increase or decrease the amount of liability of the operator:
Provided further that where the amount of liability is decreased, it shall not be less than rupees one hundred crore:
Provided also that the amount of liability shall not include any interest or cost of proceedings.
Most unlawful and unreasonable provision of this Bill, and should be deleted outright. Liability should commensurate the damage and compensate every loss. Penalty in proportion to guilt and compensation to wipe out the loss are basic and universal norms. A government elected for five years has no authority to sacrifice this right of future generations for benefit of a business company. Remove all limits on liability. Do not deny the rights of people by passing a new law. It is unconstitutional, against the norms of Environmental law, International Law, etc.
How can the Government deny the interest and cost of proceedings if the victim is otherwise entitled to?
The Convention for Supplementary Compensation (CSC) does not obligate the GoI to go in for such differentiated liabilities, one for private operator and another for the state affiliated operator.
This provision has to go.
In case of Bhopal gas disaster, the compensation amount settled (to be paid by the UCC) back in 1989 was 470 million US $. That was pretty much inadequate.
In case, of oil spill in the Gulf of Mexico, the BP has committed an initial amount of US $ 20 billion. And there will be no cap. In the US, in case of a nuclear accident, the first 300 million US $ to come from the respective insurance cover, then up to US $ 10 billion from a common pool of funds maintained by the nuclear industry. Beyond that, the Federal Government, without any cap. (Ref.: P. 2/4 of ‘The Price-Anderson Act: Background Information: November 2005’ at <http://www.ans. org/pi/ps/ docs/ps54- bi.pdf>.)
S 7. Liability of Central Government
7. The Central Government shall be liable for nuclear damage in respect of a nuclear
incident, —
(a) where the liability exceeds the amount of liability of an operator specified under sub-section (2) of section 6, to the extent such liability exceeds such liability of the operator;
(b) occurring in a nuclear installation owned by it; and (c) occurring on account of causes specified in clauses (i) and (ii) of subsection (1) of section 5.
If a government, who is not supplier, operator, or investor can be made liable for the damage caused by accident, it can be called absolute liability which stricter than absolute liability recognized, where even Act of God or Civil war is no defence. Then why not this liability be extended to maker/supplier and operator? Why should Government spend people’s money to pay people’s loss caused by MNC?
S 8 Insurance cover to limited liability
8. (1) The operator shall, before he begins operation of his nuclear installation, take out insurance policy or such other financial security, covering his liability under sub-section
(2) of section 6, in such manner as may be prescribed.
(2) The operator shall from time to time renew the insurance policy or other financial security referred to in sub-section (1), before the expiry of the period of validity thereof.
(3) The provisions of sub-sections (1) and (2) shall not apply to a nuclear installation owned by the Central Government.
When even Motor Vehicle Act imposes a statutory obligation on owners of vehicles to insure their ‘unlimited’ liability towards third parties, how can insurance of nuclear operator be limited?
“Under Sub-section (2) of S 6” should be removed.
S 9: Claim Commissioners
9. (1) Whoever suffers nuclear damage shall be entitled to claim compensation in accordance with the provisions of this Act.
(2) For the purposes of adjudicating upon claims for compensation in respect of nuclear damage, the Central Government shall, by notification, appoint one or more Claims Commissioners for such area, as may be specified in that  notification.
It should be called special nuclear claims courts and be made independent in function so that they decide liability and do justice. But the hands of these commissioners are tightened with limitations. Remove these limitations.
The Claims Commission must include member(s) of the medical profession with an established track record of engaging with people’s health issues to ensure the proper assessment of the health impact of an “incident”.
S 15 Procedure for claims
15. (1) Every application for compensation before the Claims Commissioner for nuclear damage shall be made in such form, containing such particulars and accompanied by such documents, as may be prescribed.
(2) Subject to the provisions of section 18, every application under sub-section (1) shall be made within a period of three years from the date of knowledge of nuclear damage by the person suffering such damage.
Prescribing such forms as mandatory will limit the rights of the victims.
These forms should not be made compulsory though advised to be used.
S 16(3) Order to restrain the operator who is likely to remove the property.
(3) Where an operator is likely to remove or dispose of his property with the object of evading payment by him of the amount of the award, the Claims Commissioner may, in accordance with the provisions of rules 1 to 4 of Order XXXIX of the First Schedule to the Code of Civil Procedure, 1908, grant a temporary injunction to restrain such act.
It is good but not enough; it should be empowered to attach the property also.
S 17 Right to recourse when contract is there.
17. The operator of a nuclear installation shall have a right of recourse where —
(a) such right is expressly provided for in a contract in writing;
(b) the nuclear incident has resulted from the willful act or gross negligence on the part of the supplier of the material, equipment or services, or of his employee;
(c) the nuclear incident has resulted from the act of commission or omission of a person done with the intent to cause nuclear damage.
Right to recourse is available whether there is contract or not. This provision limits the right unreasonably.
The right under (b) should extend against manufacturer also.
The contract between any and every operator and its supplier(s) (of equipment, material or services, as the case may be) must include in writing a provision to the effect that the operator shall have the right of recourse in case of an “incident” without any exception, including as regards the damage to the equipment/plant/ site.
S 18: Right to claim extinguishes in 10 years.
18. The right to claim compensation for any nuclear damage caused by a nuclear incident shall extinguish if such claim is not made within a period of ten years from the date of incident notified under sub-section (1) of section 3:
Provided that where a nuclear damage is caused by a nuclear incident involving nuclear material which, prior to such nuclear incident, had been stolen, lost, jettisoned or abandoned, the said period of ten years shall be computed from the date of such nuclear incident, but, in no case, it shall exceed a period of twenty years from the date of such theft, loss, jettison or abandonment.
There should not be such limit at all.
S 20 Nuclear Damage Claims Commission
19. Where the Central Government, having regard to the injury or damage caused by a nuclear incident, is of the opinion that—
(a) the amount of compensation may exceed the limit specified under sub-section (2) of section 6; or
(b) it is expedient and necessary that claims for such damage be adjudicated by the Commission instead of Claims Commissioner; or
(c) it is necessary in the public interest to provide special measures for speedy adjudication of claims for compensation, the Central Government may, by notification, establish a Nuclear Damage Claims Commission, for the purposes of this Act.
It totally depends on Govt. opinion.
If Govt. thinks compensation is sufficient there will be no commission.
Only bureaucrats cannot decide independently. It should consist of independent members from judiciary and people’s agencies without bureaucrats because they are not trained to assess the claims.
S 35 no injunction can be given by courts.
35. No civil court shall have jurisdiction to entertain any suit or proceedings in respect of any matter which the Claims Commissioner or the Commission, as the case may be, is empowered to adjudicate under this Act and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.
Section 5 Proviso says the choice of claiming damages under other laws is available. That is denied here in s 35.
S 39 Offences and Penalties, 5 yrs imprisonment
39. (1) Whoever—
(a) contravenes any rule made or any direction issued under this Act; or
(b) fails to comply with the provisions of section 8; or
(c) fails to deposit the amount under section 36, shall be punishable with imprisonment for a term which may extend to five years or with fine or with both.
These offences are breach of order by Commission, not taking insurance cover for limited liability and not depositing amount in advance.
Here criminal liability provision should be made: If the act leads to death of human being, operator shall be prosecuted for murder.
S 40 Offences by Companies
Principal company should be made liable jointly along with subsidiary company.
It is against the principle of command responsibility and thereby would ensure that minions are punished in case of violations and senior officers go scot free.
This has to be amended as:Provided that nothing contained in this sub-section shall render any such person liable to any punishment under this Act, if he proves he exercised all due diligence to prevent the commission of such offence.  “that offence was committed without his knowledge or”: to be deleted.
S 47 Protection for action taken in good faith
No such immunity in operating a nuclear plant/installation is called for. Such immunity will only engender criminal negligence and worse.
Instead of this or along with this there should be a provision to impose liability for action taken not in good faith, or done without due care or caution, or negligently done.


[3] See:
[4] See
[5] See:
[6] See:
[7] See the Abstract at
[8] Don’t Amend, Just Scrap the Bill, Praful Bidwai Opinion, Financial Chronicle, mydigitalfc.com, March 24, 2010
[9] Decision in M.C. Mehta v Union of India (Sriram gas leak case) (1987) 1 SCC 395, AIR 1987 SC 965
[10] Donoghue v Stevenson, 1932 AC 562
[11] Union Carbide Corporation v Union of India, AIR 1990 SC 273
[12] Union Carbide Corporation v Union of India, AIR 1992 SC 248
[13] The Accused has been charged under Section 304A Indian Penal Code, Keshub Mahindra v State of Madhya Pradesh, 1996 (2) Scale 522)
[14] Rylands v. Fletcher [1868] (19) LT
[15] AIR 1987 SC 965
[16] [1996 (5) SCC 647]
[17] Rylands v. Fletcher [1868] (19) LT
[18] http://beta.thehindu.com/opinion/lead/ article64688.ece?homepage=true,
[19] Indian Council of Enviro-Legal Action vs. Union of India [1996 (3) SCC 212] which was reaffirmed in Vellore Citizens’ Welfare Forum vs. Union of India [1996 (5) SCC 647]
[20] [1996 (3) SCC 212]
[21] [ibid, see page 246 para 65]
[22] [ibid, see page 248]
[23] [ibid, see page 247 para 67]
[24] [1996 (5) SCC 647]
[25] [ibid, see page 659]
[26] [ibid, see page 658 para 11]
[27] Sukla Sen’s article:  http://environmentpress.in/2010/04/02/the-civil-liability-for-nuclear-damage-bill-2010-some-tentative-observations/
[28] Bhopal CJM court punished officials of Indian company UCIL, leaving out chief of UCC, on June 7, 2010.
[29] See the Hindu news papers dated March 8 and April 1, 2010
[30] Sidhartha Varadarajan, Government dilute nuclear Bill under US pressure, The Hindu, 10th June 2010.
[31] The bill lets nuclear equipment suppliers and designers off the hook, from The great nuclear folly by Praful Bidwai at
[32] The bill was approved by Union Cabinet on November 20, 2009
or ,
[33] See revised bill at http://www.cndpindia.org/download.php?view.36> and earlier version given in Nuclear Liability Law in Developing Countries – Indian Case by B. B. Singh at
[34] Prakash Nanda is a journalist and editorial consultant for Indian Defense Review, Right Angle column, published on March 30, 2010
[35] See:
[36] News Report by Anil Sasi, Businessline, April 5, 2010
[37]Praful Bidwai, A Flawed Bill, Frontline,  March 27, April 9, 2010, http://www.flonnet.com/stories/20100409270709500.htm
[38] Ibid
[39] Ibid
[40] Views From Abroad, http://pakobserver.net/detailnews.asp?id=32103, by Shobhan Saxena
[41] Report on Civil Liability for Nuclear Damage Bill by Ajay Goyal, Anand Misra, Bikas Mohanty, Shaunak Kashyap, for Greenpeace, 2010, at page 37
[42] Sukla Sen’s article:  http://environmentpress.in/2010/04/02/the-civil-liability-for-nuclear-damage-bill-2010-some-tentative-observations/
[43] See: <http://www.iaea.org/Publications/Documents/Conventions/supcomp.htmll
[44] Praful Bidwai, A Flawed Bill, Frontline, March 27, April 9, 2010, http://www.flonnet.com/stories/20100409270709500.htm
[45] Sukla Sen’s article:  http://environmentpress.in/2010/04/02/the-civil-liability-for-nuclear-damage-bill-2010-some-tentative-observations/
[46] Praful Bidwai, A Flawed Bill, Frontline, March 27, April 9, 2010
[47] The Convention on Supplementary Compensation for Nuclear Damage: Catalyst for a Global Nuclear Liability Regime by Ben McRae at
[48] Sidhartha Varadarajan, The Hindu, 1 April 2010

Vedanta mines illegal, must be shut down: Green panel


NEW DELHI: Mining giant Vedanta consistently violated several laws in bauxite mining at Niyamgiri, encroached upon government land, got clearances on the basis of false information and illegally built its aluminium refinery at Lanjigarh, Orissa. As the company engaged in these violations, the Orissa government colluded with it and the Centre turned a blind eye.

These are some of the findings of the four-member N C Saxena committee, which on Monday recommended that the company not be allowed to mine in the hills that are the abode of the Dongaria Kondh and Kutia Kondh tribes in Orissa.

The no-holds-barred indictment of the state and private sector in the $1.7billion project brings out the short shrift given to concerns about tribal rights and environmental protection. It is significant also because it underlines the changed sensibilities of the government towards the issues against the backdrop of Left-wing extremism and why Naxalites are finding it easy to influence alienated tribal belts.

The stern report of the environment and forests ministry panel signalled that tribal rights and environmental isssues have finally muscled their way onto the governance agenda, forcing the authorities to take action against corporates who may have shown disregard for rules. The Saxena committee report, which could lead to shutting down of the Vedanta smelters in Orissa, comes after the MoEF moved to stop or stall several high-profile, heavy-investment projects, including the Posco Integrated Steel project in Orissa, which, at Rs 56,000 crore is the single-largest foreign direct investment in India, the Jindal thermal power plant in Chhattisgarh (Rs 10,000 crore), hydroelectric projects on Bhagirathi in Uttarakhand and the Navi Mumbai airport in Maharashtra (Rs 7,972 crore).

The panel was set up by the ministry of environment and forests to investigate if the state government and the aluminium giant had complied with the Forest Rights Act and Forest Conservation Act while mining for bauxite.

The report reveals exhaustive evidence to nail the complicity of the state government in permitting Vedanta to flagrantly violate the laws.

But the committee, even as it recommended that the mining project be disallowed, stopped short of asking for prosecution of the officials involved in what seems to be a blatant fraud that went unchecked for years.

"The question of whom to prosecute is secondary. First, we have to consider the clearance," said Union minister for enviroment and forests Jairam Ramesh. Asked if the violations could be set right now, the minister said, "Without prejudice to the existing case, it would be a tragedy that one violates laws and still has a window of opportunity to just pay a penalty and get away with it later."

The report will now be reviewed by the statutory Forest Advisory Committee, which will then give its recommendations to the ministry to take a final call on the forest clearance.

The report says, "This committee is of the firm view that allowing mining in the proposed mining lease area by depriving two primitive tribal groups of their rights over the proposed mining area in order to benefit a private company would shake the faith of tribal people in the laws of the land which may have serious consequences for the security and well-being of the entire country."

The report records how the state government falsified documents and concealed information from the central government to facilitate the aluminium refinery in mining bauxite while the company encroached upon government and tribal lands with impunity.

The aluminium czar Anil Aggarwal's company has illegally -- despite legal notices from the Orissa State Pollution Control Board -- begun building a refinery to produce 6 million tonnes of aluminium per annum instead of the 1 million tonnes per annum plant that it had got the green clearance for.

The committee -- that included S Parasuraman, director of Tata Institute of Social Sciences; Promode Kant, retired forest official; and Amita Baviskar, professor at the Institute of Economic Growth -- pointed out how right from the beginning, the firm had furnished falsified reports to the Centre to seek clearance, and how the state officials ranging from the highest bureaucrats to the collectors of two districts either refused to enforce existing laws or simply colluded with the company to deny the tribals right over their lands.

Read more: Vedanta mines illegal, must be shut down: Green panel - India Business - Business - The Times of India http://timesofindia.indiatimes.com/business/india-business/Vedanta-mines-illegal-must-be-shut-down-Green-panel/articleshow/6321872.cms#ixzz0xJfQXrtF




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