Vande Mataram

Wednesday, September 15, 2010

US lamenting about Indian Nuclear Liability Bill

While going through an op-ed in the Wall Street Journal which was titled "India Law Threatens U.S. Energy Deals" where the writers argue that the deal affects business interests of the US, but I felt their argument is not compelling to listen, keeping the thought of considering it aside. Most of the content of the article was cited to people people familiar with the matter, but not even one reference was given to any one person familiar with this matter. 

The article claimed that the U.S. used its global influence to nullify the international community's moratorium on nuclear trade with India after Buddha laughed in 1974. It also claimed that the U.S. expected India to set up a civil nuclear regime in place to get business for companies like GE and Westinghouse. If that is the case how did India successfully tested another nuclear bomb in 1998, given fact that the US influence resulted in India's favor only in early 2000s?

The article also claims that the nuke law threatens the progress in other business interests and further commerce between India and US. People familiar with the issue are looking for ways to circumvent the law, claims the article. Also it goes into detail about circumventing the law by Government to Government agreement pledging indemnity to suppliers foreign or domestic. Other way suggested is to negate the law when it is formally implemented when the executive comes up with a different interpretation challenging the purpose of the law. Another way suggested is for the Nuclear Power Corporation of India Ltd to sign contracts promising to take on all liability with U.S. suppliers. 

When I wanted more information about the nuke law, a part of the nuke cooperation through the 123 agreement, I did quite a bit of research online. I didn't go to any sites those ask to pay to view contents. I relied mostly on contents available for free and from trustworthy sources, like Government of India, Government of South Korea, think tanks of US and related countries, IAEA and opinions from experts who know the intricacies of the nuke job than those just read materials and claim expertise in media.

Well, none of the 28 countries which have nuclear liability laws insist on foreign supplier liability. The Rajiv-Gorbachev nuke pact to setup the Koodankulam Nuclear reactor also doesn't have the supplier liability clause to this stringent effect. The supplier liability ended when the reactor and related materials are handed over to the NPCIL. The argument that the suppliers foreign or domestic, Government or private would find it a risk too costly compared to the benefits from such a business is considerable. The rules of the game has been changed that people feel that India's stand smacks the my way or high way attitude. 

But the international conventions give the operator the right of recourse against a supplier, take up the Vienna Convention and the Paris Convention Articles as examples. The South Korean nuclear liability law gives the operator the right to catch hold of the supplier of any material, service or equipment when damage is done willfully or through negligence. This is normal in all businesses. If you supply me a material or equipment of inferior quality or do me a service of lesser quality than agreed upon, then I have the right to sue you. 

Why is the US whining upon this normal clause of general business practice/mercantile law? US industry has done business with South Korea with this so clamored threatening clause in force. Then why are they whining when India says if you do wrong own up the responsibility. We have history of the US business interests doing serious wrongs and instead of remedying pulling up stakes by pulling some political strings. Our own example is the Bhopal tragedy which the said WSJ article describes as the worst industrial disaster in the world, but considers the reference to it as a deliberate attempt by the opposition for the sake of opposing a lucrative deal, promising bright future, by citing a 26 year old incident.

The pain and suffering of the toxic gas leak victims and the impact the incident had on their lives and the psyche of their kinsmen could not be understood, because the real pain was told but largely went unreported for lack of follow ups by the media. They had their own priorities and preferences. Belittling one of the worst industrial disasters of the world and its pathetically handled remedial measures reveal a callous attitude towards the basics of journalism. It is one of the industrial disasters when it happens miles away and thousand lose their lives and future, but it is pain and cry when it happens to you. In words familiar to the US, "It's a recession when your neighbor loses his job; it's a depression when you lose yours."

Well, what is the way out with US working out of its way to pressurize us to water down the safety clauses? They work so hard to circumvent this law neither for the sake of the victims of any nuke disaster, nor to reduce insurance cost for the insurer (in business sense), but only to safeguard their business interests. The US nuke industry has always been averse to legal tangles in foreign soil, but wishes to get business without any risks to its profits. This is like wishing to get an apple a day without planting and growing a tree or spending a penny to buy one. There is no free lunch, is the answer to this attitude.
The better option is to do nuke business with South Korea. UAE has been working with South Korea on its nuke power plants. Seoul has its own stringent laws and is not party to any external conventions. So, they would understand our concern for safety. The UAE deal brings some interesting facts to light. The Korean have technology comparable to Japanese and arguably advanced than the US/EU giants. Koreans have a strong record for safety which was one of the prime reason the UAE Government awarded the $ 40 bn contract to Koreans.  
The Koreans do better quality job for a competitive price while the US or EU companies charge more but take less responsibilities for any contingency.

The US/EU argument supporting their businesses are mostly depending on political clout they have (or had?) in the region, but Koreans talk business and could be trusted to walk the talk, given their business history. 

Wednesday, September 8, 2010

Segregation of topics

Vande Maatharam!

I've decided to segregate my blog into two.One for topics on politics, public administration, law and related issues while another on business, economy, management and related subjects. Here under the blog titled
"yathaarthaM vadaami" I would be speaking (writing rather) on politics, public administration, law and related issues. My old posts are also here to stay though. Would keep thinking aloud here, hopefully from tomorrow.