In 2008, India signed a civil nuclear cooperation agreement with the United States in an effort to "break the ice" on its nuclear isolation, while Washington is believed to try to take the lead to dominate India's nuclear market.
The deal triggered a controversy around the world because India so far has not yet signed the Nuclear Non-Proliferation Treaty.
U.S. companies also failed to take the lead to enter India's nuclear market and as India does not have a law to limit compensation payments by private companies in case of a nuclear accident.
The bill passed by the lower house on Wednesday limited the liability of foreign companies at 320 million U.S. dollars in case of an industrial accident.
The new bill also allows private companies to enter India's nuclear market.
If the bill takes effect, American private companies reportedly could build nuclear reactors at least at two sites in India, while U.S.-based firms GE-Hitachi and Westinghouse Electric, a subsidiary of Japan's Toshiba Corp., could win contracts worth 10 billion U.S.dollars.
India's cabinet already approved the bill last Friday. Now the bill needs clearance from the upper house of parliament.
The Congress Party-led coalition has a narrow majority in the lower house, but cannot control the upper house.
India's leading opposition party Bharatiya Janata Party on Wednesday supported the passage of the bill at the lower house to develop the country's nuclear market, but it forced the government to make some modifications.
