What Happened
- India's SHANTI Act (Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India) has received presidential assent after passing both Houses of Parliament, replacing the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010.
- Analysts argue that achieving the government's 100 GW nuclear target by 2047 requires more than legislative change — transparent resolution of key operational issues including tariffs, fuel ownership, waste management, insurance, dispute settlement, and regulatory autonomy is essential.
- For the first time since Independence, private Indian companies and joint ventures (with up to 49% FDI) are permitted to build, own, and operate nuclear power plants under the new framework.
- The SHANTI Act grants statutory independence to the Atomic Energy Regulatory Board (AERB), though concerns remain about its continued structural link to the Department of Atomic Energy under the Atomic Energy Commission.
- India currently has about 8.8 GW of nuclear capacity across 24 reactors, contributing just 3.1% of total power generation — making the 100 GW target a more than ten-fold expansion.
Static Topic Bridges
Atomic Energy Act, 1962 and India's Nuclear Governance
India's nuclear sector was governed for over six decades by the Atomic Energy Act, 1962, which established a complete state monopoly. The Department of Atomic Energy (DAE) and Nuclear Power Corporation of India Ltd (NPCIL) held exclusive rights over all aspects — reactor construction, fuel fabrication, and reprocessing. Amendments in 1987 and 2015 allowed government companies and joint ventures with NPCIL to participate, but private sector entry remained prohibited. The SHANTI Act fundamentally dismantles this monopoly structure.
- Atomic Energy Act, 1962 vested all nuclear activities in the Central Government and its entities
- NPCIL, incorporated in 1987 under the Companies Act, operates all commercial nuclear power plants in India
- The Civil Liability for Nuclear Damage Act, 2010 had a single liability cap of ₹1,500 crore for operators of reactors above 10 MW capacity — widely criticised for deterring foreign suppliers
- SHANTI Act replaces both laws with a graded liability framework: ₹100 crore for SMRs up to ₹3,000 crore for large-scale reactors
- Overall liability ceiling is set at the rupee equivalent of 300 million Special Drawing Rights (SDRs) per incident
Connection to this news: The article argues that replacing old legislation is necessary but insufficient — the real test is whether the tariff framework, fuel ownership rights, waste management responsibilities, and insurance mandates are resolved transparently to attract genuine private investment.
AERB: Regulatory Autonomy and the Independence Problem
The Atomic Energy Regulatory Board (AERB) was established in 1983 under the Atomic Energy Act to regulate nuclear and radiation safety. However, AERB has long functioned without true statutory independence — both AERB and DAE report to the Atomic Energy Commission (AEC), creating a structural conflict between nuclear promotion and nuclear regulation under the same institutional umbrella. The SHANTI Act confers statutory status on AERB and empowers it to make regulations on safety authorisations and radiological emergencies.
- AERB was set up by a Presidential Order in 1983, not by a dedicated statute — it lacked the legal authority of a full statutory regulator
- International best practice (as per IAEA guidelines) requires nuclear regulators to be structurally independent of bodies promoting nuclear energy
- SHANTI Act grants AERB statutory recognition under Section 17, safeguards its financial autonomy, and introduces an Atomic Energy Redressal Advisory Council and specialised appellate oversight
- Despite reform, AERB and DAE both remain under the AEC, which critics argue preserves the inherent tension
Connection to this news: The article emphasises that genuine regulatory autonomy — not just statutory status — is needed to build investor confidence and ensure safety oversight is credible in a privatised nuclear sector.
Small Modular Reactors (SMRs) and India's Nuclear Strategy
Small Modular Reactors are advanced nuclear reactors with a power output typically below 300 MWe, designed for modular factory construction and deployment in locations unsuitable for large conventional plants. India has been developing its own 220 MW Bharat Small Reactor (BSR), and NPCIL issued a Request for Proposals to private industry at the start of 2026 (extended to March 31, 2026) to finance and build a fleet of BSRs.
- BSR (Bharat Small Reactor) uses pressurised heavy water reactor technology — a proven Indian design
- SMRs are seen as critical for India's 100 GW target because they can be deployed faster, at lower upfront capital cost, and in a wider range of locations
- The SHANTI Act's IPP (Independent Power Producer) model specifically facilitates private financing of SMR projects
- Global SMR programmes are advancing in the US (NuScale, TerraPower), UK (Rolls-Royce), and Canada (ARC Clean Technology)
Connection to this news: The SMR pathway is central to India's 100 GW strategy — but only if issues around fuel supply agreements, waste disposal obligations, and insurance requirements are resolved in a way that makes private financing viable.
Nuclear Liability and Supplier Concerns
Under the Civil Liability for Nuclear Damage Act, 2010 (CLNDA), India had included the controversial "right of recourse" provision (Section 17(b)) allowing nuclear operators to sue equipment suppliers if the damage was caused by a defect in the supplied item. This provision was widely blamed for keeping major global nuclear suppliers like GE-Hitachi and Westinghouse out of India.
- CLNDA 2010 was enacted after India signed the Indo-US Civil Nuclear Agreement (123 Agreement) in 2008
- Section 17(b) of CLNDA allowed operator recourse against suppliers, conflicting with the international Convention on Supplementary Compensation (CSC) framework
- SHANTI Act restricts recourse to suppliers only in cases of express contractual agreement or intentional misconduct — aligning India with global nuclear liability norms
- India signed but has not yet ratified the CSC; the SHANTI Act's supplier liability reform is expected to unblock foreign supplier entry
Connection to this news: Resolving the supplier liability question was essential to attracting global nuclear technology partners — but article argues tariff certainty and fuel ownership rules must also be clarified to complete the investment-ready framework.
Key Facts & Data
- India's 100 GW nuclear target by 2047 is part of the Viksit Bharat strategy; current capacity is approximately 8.8 GW (24 reactors)
- SHANTI Act replaces the Atomic Energy Act, 1962 (63 years old) and the Civil Liability for Nuclear Damage Act, 2010
- Private sector can hold up to 49% FDI in nuclear projects under the new framework
- Graded liability caps: ₹100 crore (SMRs) to ₹3,000 crore (large reactors); overall ceiling at 300 million SDRs
- Nuclear power contributes approximately 3.1% of India's total electricity generation
- NPCIL's RFP for 220 MW Bharat Small Reactors (BSR) was extended to March 31, 2026
- AERB was established in 1983 under a Presidential Order — it lacked statutory status until the SHANTI Act
- India is the third largest electricity consumer in the world; peak demand crossed 250 GW in recent years