India willing to pay more for new units?
As New Delhi prepares for Russian President Vladimir Putin’s visit to India in October, there are increasing indications that in the post-Fukushima scenario, New Delhi will be willing to accept a higher cost of construction for the proposed units 3 and 4 at the Russian-built Koodankulam nuclear plant in Tamil Nadu. Provided, of course, there is adherence by the Russians to India’s nuclear liability laws enacted in 2010.
With the emphasis now increasingly on nuclear safety, it’s understood that India too would like the supplier, in this case Russia, to adhere to the 2010 law. As per the “right of recourse” in this law, the operator can ask the supplier to pay compensation in the event of a nuclear mishap if the equipment is found faulty up to a “product liability period”.
Sources said, “The discourse has changed in the last three years. Post-Fukushima, there is a feeling here that the public will be willing to accept a higher cost for the plant than accept a lower level of safety. If the supplier accepts liability as per the 2010 law, the plant will be safer.”
India and Russia are engaged in techno-commercial negotiations for the proposed units, KK-3 and 4 at the Koodankulam plant. While it was expected that the agreement would be inked during Mr Putin’s visit, the inking of the pact just might get delayed if the two sides fail to reach any understanding on the cost aspect and negotiations are prolonged. As per ballpark estimates, units 1 and 2 cost India between $3 million to $4 million. If Russia does not get a waiver from India’s nuke liability law, sources said that more would have to be paid as cost escalation both in terms of the time that has elapsed since units 1 and 2 were built in Koodankulam and India’s nuclear liability law that puts the onus on the supplier.
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