The SHANTI Act

It seeks to turn nuclear power from a strategic, state-dominated enclave into a more competitive, investment-friendly pillar of India’s energy-security strategy by 2047.

1. Historical evolution of India’s civil nuclear sector

• India’s nuclear journey began with the establishment of the Atomic Energy Commission (1948) and the Apsara research reactor (1956), followed by the Tarapur (1969) and Rajasthan (1970s) power stations. Homi Bhabha’s three-stage nuclear power programme (natural uranium PHWRs → fast breeder reactors → thorium-based systems) was adopted in 1958 to achieve long-term energy independence using domestic thorium.
• The 1974 nuclear test led to technology denial and sanctions, forcing India to pursue indigenous reactor and fuel-cycle capabilities while keeping nuclear power under tight state control. The 2008 Indo-US civil nuclear agreement partially ended this isolation, enabling international cooperation, but capacity addition remained modest due to regulatory, financial and liability constraints.

2. Role of nuclear energy in India’s energy security

• As of late 2025, India has about 8.78 GW of installed nuclear capacity, contributing roughly 3% of total electricity generation. Yet nuclear power is seen as a firm, low-carbon source that can complement renewables and support grid stability in the push towards net-zero emissions by 2070.
• Government roadmaps under “Viksit Bharat 2047” now target around 100 GW of nuclear capacity by 2047 through a mix of large reactors and emerging technologies like Small Modular Reactors (SMRs), positioning nuclear as a key pillar of long-term energy security and decarbonization. Nuclear energy also reduces import dependence on fossil fuels, enhancing strategic autonomy in the energy sector.

3. Challenges in evolution and growth

• Financial and project-management constraints have slowed nuclear expansion: large reactors require high upfront capital, long construction periods and complex clearances, often resulting in delays and cost overruns. Public sector entities like NPCIL have limited balance-sheet capacity to sustain a rapid scale-up, and state utilities have been cautious buyers of nuclear power at higher tariffs.
• International liability concerns under the Civil Liability for Nuclear Damage (CLND) Act, 2010— especially supplier liability—discouraged foreign vendors and complicated fuel and technology deals. In addition, land acquisition, local protests, and lingering safety perceptions since Chernobyl and Fukushima have made site development politically sensitive.

4. Legal and regulatory framework shaping the sector

• The Atomic Energy Act, 1962 vested all nuclear material and most nuclear activities in the Union government, effectively giving a state monopoly over nuclear power generation through entities like NPCIL and BHAVINI. The CLND Act, 2010 laid down a special civil liability regime for nuclear damage, creating a no-fault liability on operators with capped liability and a controversial right of recourse against suppliers.
• The Atomic Energy Regulatory Board (AERB) was created in 1983 by executive order to oversee nuclear and radiation safety but lacked a clear statutory basis, leading to repeated calls from experts and international bodies for an independent, law-backed regulator. This legal architecture kept the sector tightly controlled but also constrained private participation and complicated large-scale capacity expansion.

5. Safety and security concerns

• Nuclear accidents carry low probability but very high impact, with global events such as Chernobyl (1986) and Fukushima (2011) shaping public fears and international safety norms. In India, issues flagged include ageing reactors, seismic and coastal vulnerabilities at some sites, emergency preparedness, waste management, and transparency of safety assessments.
• Safety regulation historically suffered from perceived conflict of interest, as AERB reported administratively to the Atomic Energy Commission, which also promotes nuclear power. Civil society groups have repeatedly demanded clearer separation between promotion and regulation, stronger public consultation, and robust liability and compensation mechanisms to ensure accountability in case of accidents.

6. SHANTI Act: Background and Objectives

• The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act (SHANTI Act), 2025 consolidates and modernizes India’s nuclear legal framework by repealing the Atomic Energy Act, 1962 and the CLND Act, 2010.
• Its stated objective is to unlock large-scale investment—domestic and foreign—in nuclear power, while updating safety, security and liability regimes in line with India’s clean-energy and Viksit Bharat 2047 goals.
• The Act follows long-standing recommendations to give statutory backing to the regulator, clarify liability rules, and enable new technologies such as SMRs and advanced reactors to be deployed at scale.

7. Key features of the SHANTI Act

7.1 Opening the sector to private participation

For the first time, the law permits Indian private companies, joint ventures and certain foreign-linked entities to build, own, operate and decommission civil nuclear power plants, ending NPCIL’s operational monopoly. Fuel supply and control over fissile materials, however, remain with the Central government; private players cannot own nuclear fuel or exercise independent control over strategic materials.

Private participation under the SHANTI Act is essential to bridge India’s massive investment gap—from 8.8 GW current nuclear capacity to the 100 GW target by 2047—requiring roughly USD 214 billion and around 4 GW annual additions beyond public sector limits. While it unlocks capital, execution expertise and technology transfer, realization hinges on overcoming fuel dependency, liability perceptions and execution risks.

Private entry addresses NPCIL’s funding constraints, enabling joint ventures and direct private builds by major firms. Analysts project 30–50% of new capacity from private sources, with up to 49% FDI allowed, potentially adding 40–60 GW via large reactors and SMRs if tariffs align with renewables.

The Act aims to create a single, streamlined licensing process for all civil nuclear activities, thereby reducing procedural fragmentation that previously deterred investors. This is expected to attract large domestic conglomerates and international partners into nuclear power generation under strict regulatory oversight.

7.2 Revised liability and compensation regime

• The SHANTI Act repeals the CLND Act and removes statutory supplier liability, placing primary and exclusive liability for nuclear damage on the plant operator, with liability caps linked to installed capacity.
• Operators can now pursue suppliers only contractually, for example through indemnity clauses for willful misconduct, while a central Nuclear Liability Fund covers excess claims. This aligns India more closely with international nuclear liability conventions.
• It provides for a Nuclear Damage Claims Commission and allows creation of a Nuclear Liability Fund to ensure timely compensation in case of accidents.

7.3 Strengthening regulation and safety oversight

• The Act grants statutory status to the AERB as the national nuclear and radiation safety regulator, making it accountable to Parliament and clearly defining its powers and independence.
• AERB is empowered to set safety standards, license and inspect facilities, issue binding directions, and suspend or cancel operations for non-compliance across the entire lifecycle—from siting and construction to operation, transport, waste management and decommissioning.
• Institutional mechanisms such as an Atomic Energy Redressal Advisory Council and specialised appellate/dispute-resolution arrangements further structure regulatory governance and grievance redress.

7.4 Technology, Innovation and SMRs

• The SHANTI framework explicitly supports advanced nuclear technologies, including SMRs and next-generation reactors, to diversify plant sizes and siting options.
• By clarifying ownership, licensing and liability rules for such technologies, it aims to revive stalled civil nuclear deals and enable smaller, modular projects that can be added more flexibly to the grid.
• The Act is designed to integrate with broader energy and climate policies, supporting nuclear’s role in India’s net-zero and energy-transition pathways.

8. Prospects and related debates

Prospects

• Unlock significant private and foreign investment and accelerate progress toward the 100 GW nuclear target by 2047.
• Improve regulatory credibility through a statutory AERB, potentially boosting public trust and international cooperation in nuclear technology and fuel supply.
• Support energy security and climate commitments by expanding reliable, low-carbon baseload capacity, complementing intermittent renewables.

Debates and concerns

• Critics warn that removing supplier liability and sharply capping operator liability may under-compensate victims in case of a major accident, effectively privatizing profits while socializing risk.
• Trade unions and civil society fear that opening generation to private companies may prioritize commercial returns over robust public consultation, transparency and long-term waste management.
• Questions are also raised about whether AERB’s appointment process and linkages truly ensure independence from the executive and promoter agencies.
• From a strategic standpoint, some analysts caution that deep private and foreign involvement must be carefully ring-fenced to protect sensitive technology, material accounting and national security interests.

9. Conclusion

From a policy-evolution perspective, the SHANTI Act represents a decisive shift from a closed, state-dominated nuclear estate to a liberalized, investment-centric and regulator-driven framework aimed at making nuclear power a major contributor to India’s clean-energy portfolio.

It promises faster capacity addition, stronger statutory regulation and better alignment with global nuclear-liability norms, but simultaneously raises serious questions about victim compensation, regulatory independence, democratic accountability and the balance between safety and commercial incentives.

Actually, SHANTI is both an opportunity and a stress test: its success will be judged by whether India can scale nuclear capacity for energy security and net-zero without diluting the high bar of safety, transparency and justice that a technology of such risk inherently demands.