Does a Rs 15-billion insurance cover serve the expanding nuclear business in India? Even though the target of 63 GWe of nuclear power by 2032 set by its National Energy Policy looks far too ambitious to achieve, the scaled-down 22 GWe would also need more insurance cover. It is one of the key themes for global nuclear industry captains and Indian insurance companies, as they gather for the two-day India Nuclear Business Platform in Mumbai this week. It also makes private companies reluctant to invest in the Indian nuclear projects, giving state-run ventures like those from Russia and France an advantage over them. The Indian reinsurance company, GIC-Re, with the four state-run insurance companies, is in a difficult position to try to convince the foreign companies that the sum is adequate for now. The Indian government had set up the Rs 15-billion India Nuclear Insurance Pool on June 12, 2015, to provide cover corporate liability against any accident at nuclear plants. The cover comes under India’s Civil Liability for Nuclear Damage Act of 2010 (CLND Act). The pool was created as India stepped out to solicit more investment in its power sector by nuclear power developers. The sum agreed to essentially caps the liability of the insurers, even as project developer companies are told that their liability is unlimited. The Indian government claims, not incorrectly, that the risks are quite unlikely, so making the pool a larger sink only leads to larger demand for greater capital from GIC-Re and the four insurance companies. Though there are seven other Indian insurance companies with stakes in the pool, such as ICICI Lombard and Tata AIG, their stakes are narrow. The big money comes from the government-run New India Assurance, National Insurance, United India and Oriental Insurance, each of which contributes Rs 3 billion to the corpus.
Source: https://defenceupdate.in/
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