M. Ramesh | THE HINDU | June 1, 2012

 

The point whether the equipment supplier is liable for damages or not if something goes wrong in a nuclear power plant and results in a disaster has been a subject of intense debate in India.

Would it be the power plant operator, Nuclear Power Corporation of India or the equipment (reactor) supplier like GE or Westinghouse, who should pay up?

A file photo of Nuclear Power Corporation CMD, Mr S.K. Jain. Courtesy: THE HINDU

In an interview to Business Line, Mr S.K. Jain, Chairman and Managing Director, Nuclear Power Corporation of India, who incidentally relinquished his position on Thursday after serving the corporation as CMD for eight long years, explains why it equipment supplier cannot be held liable to pay.

It may be surprising that somebody should say “it is me, and not him, who is liable to pay”, but Mr Jain says that the reactor supplier cannot legally be held responsible.

(But first to clarify, in case of any disaster, it is the operator (NPCIL) who will pay the affected people. The question is whether or not the supplier should be made contract-bound to reimburse the operator.)

Take Kudankulam, as a case in point. The Russians have given the ‘containment design’. But the construction is all by NPCIL. “Should I buy steel, cement and gravel from them?” asks Mr Jain.

Things like post-commissioning maintenance, spares are all outside the Russians’ control, so how could they be asked to pay if something goes wrong?

Mr Jain said that the supplier will be liable for any ‘malafide defect’ in the design.

But what about non-malafide defect? Mr Jain said that even if there was something wrong with the ‘containment’, “six or seven more things would have to go wrong” for a disaster to occur, which are all “outside the control of the supplier”.