NEW YORK ( TheStreet) -- GE Hitachi Nuclear Energy, a partnership between General Electric (GE - Get Report) and Hitachi (HIT), and Westinghouse Electric, a Toshiba unit are likely to benefit from the recently approved Civil Liability for Nuclear Damage Bill in India.
On Monday, the Indian Parliament approved the compensation bill for nuclear accidents subsequent to tougher provisions on supplier liability. This move would end the two-year nuclear ban on India, whose atomic energy market is estimated between $150 billion and $175 billion.
It would enable U.S. companies to compete and invest almost $100 billion to $150 billion in India's nuclear power industry. Additionally, these companies would compete with European state- run rival companies as India boosts nuclear power generation to increase thirteen-fold by 2030 to spur economic growth.
Prime Minister Manmohan Singh and the Congress government had to rewrite the Civil Liability for Nuclear Damage Bill to accommodate all concerns and views of opposition parties as it seeks to ensure the passing of the bill before U.S president Barrack Obama visits India in November. The new law might lead to a significant increase in nuclear energy contribution to India's current power supply, which currently accounts for a meager 3%.In order to gain adequate votes for passing the bill, the Indian government inserted a clause capping payouts for compensation claims by the Nuclear Power Corporation of India at $322 million beyond which the government would be responsible. After paying compensation, Nuclear Power Corp. can seek money from suppliers for defective equipment or materials, according to the bill. However, analysts believe that such clauses would not be accepted by suppliers world-wide and would hamper the growth of the nuclear manufacturing industry in India.