Basic Provisions of CLNDA
- Enacted in 2010 to provide compensation for nuclear damage and ensure a mechanism for speedy claims.
- Strict and no-fault liability on the operator (NPCIL in India’s case).
- Operator’s liability is capped at ₹1,500 crore; Government steps in beyond that up to ~₹2,100–₹2,300 crore.
- India acceded to the Convention on Supplementary Compensation (CSC) in 2016.
Relevance : GS 2(Governance )
CLNDA’s Unique Supplier Liability Clause
- Unlike CSC, India’s law allows operator to seek recourse from the supplier under three conditions:
- Section 17(a): If expressly mentioned in the contract.
- Section 17(b): If damage was caused by defective equipment/services (even if not in contract).
- Section 17(c): If damage was caused by intentional misconduct.
Key Ambiguities
- Section 17(b): Goes beyond international norms, creating automatic liability for suppliers if equipment is defective.
- Section 46: States CLNDA does not prevent other legal proceedings under other laws (e.g. tort law), potentially exposing suppliers to unlimited civil and criminal liability.
- No clear definition of “nuclear damage” under CLNDA → increases legal uncertainty.
Concerns of Foreign & Domestic Suppliers
- Fear of uncapped liability, especially due to Section 46, discouraging investment.
- Absence of clarity on insurance requirements and coverage for suppliers.
- Potential for class-action lawsuits or civil suits, despite CSC’s intention to limit claims to operator alone.
Impact on Projects
- Major foreign-backed projects like:
- Jaitapur (France),
- Kovvada (USA) remain stalled.
- Only Kudankulam (Russia) has progressed — initiated before CLNDA, operates under a separate framework.
Government’s Stand
- Claims CLNDA is in line with CSC and Section 17(b) is permissive, not mandatory.
- However, legal experts assert each subsection (17a, 17b, 17c) is independent — supplier can be sued even if contract doesn’t mention it.
- Government stance on Parliament debates holds little weight in court; statutory language prevails in legal trials.
Broader Implications
- Suppliers demand amendment or legal clarification for protection.
- Law intended to protect victims and promote accountability post-Bhopal tragedy, but ends up deterring foreign investment.
- Without reform, India risks missing out on clean nuclear energy expansion critical for energy security and climate goals.
