In recent years, the government has promoted nuclear power as a key component in the country’s efforts to achieve energy security. It’s a relatively clean source of electricity that doesn’t have the uncertainties associated with renewables, and can, therefore, fulfil the need for baseload power. However, nuclear energy accounts for only 3 per cent of the overall power generation today. The country has set a short-term goal to increase its nuclear power capacity to 22.5 GW by 2032, and a long-term target to reach 100 GW by 2047. Implementing this ambition will require unlocking private capital and opening up one of India’s most closed sectors. The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Bill, 2025 (SHANTI), tabled in Parliament on Monday, attempts to do that. It allows up to 49 per cent foreign direct investment (FDI) in certain nuclear activities. The Bill does away with a contentious clause in the Civil Liability for Nuclear Damage Act (CLNDA), which held suppliers liable for accidents and was a deterrent for foreign vendors — it was among the reasons for the country’s inability to leverage the full commercial potential of its nuclear deal with the US, nearly two decades after it was inked. The lack of clarity about the term “supplier” in CLNDA was a cause for worry for Indian sub-vendors as well.
Foreign investors, including sovereign funds from West Asia, have reportedly expressed early interest in part-financing the country’s objectives to scale up nuclear power, including entering the manufacturing value chain of small modular reactors (SMRs). These reactors address the limitations of traditional nuclear plants — they are less expensive, have shorter construction times, require less fuel and have enhanced safety features, including the ability to shut down in emergencies without human intervention. The government’s commitment to increasing nuclear capacity to 22,480 MW in the next five years makes SMRs a compelling option within India’s broader energy strategy. They feature in India’s partnerships with nuclear powers, including the US and Russia. The congenial milieu envisaged in the SHANTI Bill could also pave the way for a greater role for Indian players and the deployment of this state-of-the-art technology at scale.
