US company Westinghouse and India’s Nuclear Power Corporation signed an early works agreement on Tuesday giving the civil nuclear deal its first commercial breakthrough.
The agreement commits them to work towards preliminary licensing agreements on pricing, design and technology, skirting the contentious liability law, which was holding up actualization of the deal.
“Still a lot of work needs to be done, including understanding the implication of the nuclear liability legislation,” said secretary of state Hillary Clinton, announcing the agreement.
“But this is a significant step toward the fulfilment of our landmark civil nuclear cooperation agreement,” she added, flagging off the third India-US strategic dialogue on Wednesday.
The plant will be located in Gujarat.
India Week, as the week of talks and strategic dialogue is being called, got off to a flying start with the US on Monday exempting India and six other countries from Iran sanctions.
On Tuesday, Day 2, it was the early works agreement.
A second deal with the other US company in talks with India for setting up a nuclear plant — GE — could follow the same model, if and when its reactors were cleared by US regulators.
But the agreement with Westinghouse finally got the nuclear deal moving, after months of impasse over the liability law, which the US said, was against international norms. India has signed the Convention on Supplementary Compensation, which when enforced will over-ride the liability law, but it has not ratified it yet.
Manmohan Singh and George W Bush signed the nuclear deal in 2006, ending India's nuclear isolation. Six years after, many in the US wondered what was in it for their country.
With the early works agreement wrapped up, officials on both sides said they hoped one more contentious issue was out of the way. But officials also cautioned against exaggerating the importance of the agreement. “We are still years from a US-made nuclear reactor lighting up Indian homes,” said an official.