India cabinet approves nuclear liability bill

image captionAt present, nuclear energy provides only 3% of India's energy needs

India's cabinet has approved a controversial draft law aimed at opening up its civilian nuclear power industry to private investment.

It came after the government dropped an addition to the bill which opposition parties said would limit the liability of companies in case of accidents.

The law sets out a framework for how any compensation claim will be managed.

The bill will now be introduced in parliament, where it is expected to be passed easily.

"After the bill is passed in parliament we will enter a series of negotiations for the purchase of equipment and we will see actual contracts being signed," Prithviraj Chavan, junior minister for science and technology, said.

The bill was approved after the authorities agreed to triple the compensation cap in the event of a nuclear accident to 15bn rupees ($322m; £207m).

The bill is part of a landmark agreement with the US in 2008 which granted India access to foreign nuclear technology.

But some private firms, especially in the US, have been reluctant to set up nuclear power plants in India without a law that would limit their liability.

The contribution of nuclear energy is now expected to rise from its current level of a mere 3% as India embarks on a substantial expansion of nuclear power reactors over the next few decades.

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