India's lower house of parliament has approved a controversial bill that will open up the country's $150 billion nuclear power market to foreign investors.
The Civil Nuclear Liability Bill was passed Wednesday after the government made several changes to win over the main opposition Bharatiya Janata Party.
The amended bill triples the cap on compensation in the event of a nuclear accident to $322 million and extends provisions for liability claims to suppliers of nuclear reactors.
The legislation is crucial for American companies that want to engage in civil nuclear commerce in India. Unlike state-owned French and Russian companies, their liabilities are not underwritten by the government, making them hesitant to invest unless those liabilities are clearly spelled out.
India's civil nuclear market opened up in 2008, when Prime Minister Manmohan Singh and former U.S. President George W. Bush agreed to lift a 34-year-old U.S. ban on civilian nuclear trade with India. The ban was imposed after India conducted nuclear tests.
Mr. Singh said Wednesday the measure is the last step in ending the country's nuclear isolation. New Delhi said the measure will help attract foreign investors in its emerging nuclear power market.
The legislation must now be passed by the upper house of parliament.
India's government has been working to get final passage of the bill before U.S. President Barack Obama visits later this year.