Indemnity to Covid Vaccines – UPSC Prelims

  • Foreign manufactures of COVID vaccines are demanding indemnity from liability as a condition for selling their vaccines to the country.
What is Indemnity?
  • In simple terms, indemnity means security against a loss or other financial stress. This is commonly used in insurance contracts.
  • It protects the manufacturers from any potential civil-legal liability or immunity from being sued by people for any unforeseen complications arising from their COVID-19 vaccine.
  • The law on drugs in India does not have a provision for indemnity related to the grant of approval for any new drug or vaccine in the country.
  • Section 124 of the Indian Contract Act, 1872 defines a contract of indemnity. It is defined as a contract by which one party promises to save the other from any loss caused to the latter.
  • If the government gives an indemnity to vaccine manufacturers, then the government, and not the vaccine maker, would be liable to compensate any citizen who claims to have side effects/death due to taking the vaccine.
  • In the event of a court ordering payment, the company will be in a position to recover the amount from the government.
Is the demand for indemnity a standard practice?
  • Indemnity is essentially a contractual matter between the supplier and recipient.
  • For example, Pfizer is believed to have obtained indemnity from several countries including the United Kingdom. However, it has declined to discuss the issue in public.
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