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- Nuclear Energy and India's Search for Energy Sovereignty
India stands at a decisive moment in its energy transition. Rapid industrialisation, digital infrastructure growth, expanding data centres, electric mobility and climate commitments have together exposed the limits of a power system overly dependent on fossil fuels and intermittent renewables. While solar and wind energy dominate the discourse on clean energy, nuclear power remains the only scalable, round-the-clock, low-carbon source capable of supporting India's long-term baseload requirements.
Against this backdrop, the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025 represents the most significant reform in India's civil nuclear law since the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010. The Bill does not merely amend existing legislation; it attempts a structural reset of India's nuclear governance architecture by consolidating regulation, enabling controlled private participation, strengthening safety oversight, and aligning nuclear policy with India's clean-energy ambitions.
This article critically examines how India's civil nuclear law is evolving through the SHANTI Bill, how it can open a new chapter in the energy sector, and what unresolved legal concerns remain beneath its progressive narrative.
- Evolution of India's Civil Nuclear Legal Framework
India's nuclear legal regime has historically been shaped by strategic caution. The Atomic Energy Act, 1962 vested near-total control over nuclear energy in the Central Government, reflecting concerns around national security, proliferation risks, and technological sovereignty. Over time, limited participation by government companies and joint ventures was permitted, but private sector involvement remained largely excluded.
The enactment of the Civil Liability for Nuclear Damage Act, 2010 marked a watershed moment by introducing a no-fault liability regime. However, the liability framework, particularly the supplier liability provisions, became a deterrent for foreign vendors and private investment. As a result, nuclear capacity growth remained incremental, with nuclear power contributing only around three per cent of India's electricity generation.
The SHANTI Bill, 2025 acknowledges this stagnation and attempts to address the structural bottlenecks that have prevented nuclear energy from achieving scale. It seeks to repeal and replace fragmented laws with a unified civil nuclear statute that reflects modern regulatory expectations, international best practices, and India's clean-energy commitments
- The Energy Imperative Behind the SHANTI Bill
India's electricity demand is projected to more than double by 2047. Renewable energy alone cannot meet this demand due to grid instability, storage limitations, and land constraints. Nuclear energy, with its high capacity factor and minimal carbon footprint, is uniquely positioned to complement renewables.
The SHANTI Bill aligns directly with the Government's Nuclear Energy Mission, which aims to achieve 100 GW of nuclear capacity by 2047 and support India's net-zero target by 2070. The Bill recognises that achieving this scale requires regulatory certainty, diversified investment models, and technological innovation, particularly through Small Modular Reactors (SMRs)
- Private Sector Participation: A Structural Shift in Nuclear Policy
One of the most transformative aspects of the SHANTI Bill is its calibrated opening of the nuclear sector to private participation. For the first time, private companies are permitted to engage in nuclear plant operations, power generation, equipment manufacturing, and selected fuel-cycle activities, subject to strict regulatory approvals.
This policy shift has far-reaching implications for India's energy sector. Private participation introduces capital, operational efficiency, supply-chain depth, and technological innovation. It also allows nuclear power projects to adopt commercially viable financing structures, reducing dependence on sovereign funding.
At the same time, the Bill carefully preserves sovereign control over sensitive activities such as spent fuel reprocessing, isotopic separation, heavy water production, and high-level waste management. This dual-track approach reflects a conscious legal balancing act between economic liberalisation and strategic oversight
- Strengthening Nuclear Regulation Through Statutory Empowerment
A long-standing criticism of India's nuclear regulatory framework has been the absence of an independent statutory regulator. The Atomic Energy Regulatory Board (AERB), despite performing critical safety functions, operated without clear legislative backing, raising concerns about regulatory autonomy and accountability.
The SHANTI Bill addresses this gap by granting statutory recognition to the AERB. This move enhances regulatory credibility, strengthens enforcement powers, and aligns India's nuclear governance with international norms. For investors and operators, a legally empowered regulator improves predictability and reduces compliance ambiguity. From a public interest perspective, statutory regulation enhances transparency, safety assurance, and trust in nuclear installations, which is essential for social acceptance of nuclear expansion.
- Licensing, Safety Authorisation, and Compliance Architecture
The Bill introduces a structured licensing regime governing the establishment, operation, suspension, and decommissioning of nuclear installations. Safety authorisations are mandated for all activities involving radiation exposure, reinforcing the primacy of nuclear safety within India's civil nuclear law.
By consolidating licensing, safety oversight, and compliance within a single legislative framework, the SHANTI Bill reduces regulatory fragmentation. This is particularly relevant for emerging nuclear applications in healthcare, agriculture, hydrogen generation, and industrial research, which previously operated under dispersed regulatory instruments. The integrated licensing model also facilitates faster project approvals while maintaining safety thresholds, a critical requirement for scaling nuclear capacity within defined timelines.
- A Graded Nuclear Liability Framework: A Pragmatic Departure
Perhaps the most commercially significant reform under the SHANTI Bill is the introduction of a graded nuclear liability structure. Unlike the Civil Liability for Nuclear Damage Act, 2010, which imposed a uniform operator liability cap, the new framework calibrates liability based on the nature and risk profile of the nuclear installation.
This approach aligns India's nuclear liability regime with global standards and addresses long-standing investor concerns. By reducing disproportionate exposure, the Bill improves bankability of nuclear projects and encourages private participation without compromising victim compensation mechanisms.
However, the shift also raises legitimate questions around public risk allocation. While graded liability enhances economic feasibility, it necessitates robust insurance mechanisms and sovereign backstops to ensure that victims of nuclear incidents are not left under-compensated.
- Dispute Resolution and Claims Adjudication Mechanisms
The SHANTI Bill introduces an institutional framework for dispute resolution through the Atomic Energy Redressal Advisory Council and designates the Appellate Tribunal for Electricity as the appellate authority. Additionally, it empowers the Central Government to appoint Claims Commissioners and establish a Nuclear Damage Claims Commission for severe incidents.
This structured approach to dispute resolution enhances procedural certainty and reduces litigation risks. For operators and suppliers, predictable adjudication mechanisms lower regulatory friction. For affected communities, specialised forums promise faster and more informed resolution of claims.
- Nuclear Energy as an Industrial and Technological Catalyst
Beyond electricity generation, the SHANTI Bill recognises nuclear energy as a platform technology with applications across medicine, agriculture, industry, and clean hydrogen production. The Bill's regulatory framework for non-power applications creates new growth avenues for research institutions, start-ups, and advanced manufacturing.
India's investment in indigenous SMRs, supported by budgetary allocations, positions the country as a potential global exporter of nuclear technology. This industrial dimension of civil nuclear law transforms nuclear energy from a closed strategic sector into an innovation ecosystem.
- Strategic Oversight and National Security Safeguards
Despite liberalisation, the SHANTI Bill firmly anchors strategic oversight with the Central Government. Control over sensitive fuel-cycle activities, security protocols, and safeguards remains non-negotiable. This ensures compliance with international non-proliferation obligations while preserving India's strategic autonomy.
The Bill's emphasis on coordinated oversight mechanisms reflects an understanding that nuclear expansion cannot dilute security standards. From a constitutional perspective, this balance strengthens the legitimacy of private participation within a sovereign-controlled framework.
- Key Legal Concerns and Unresolved Questions Under the SHANTI Bill, 2025
While the SHANTI Bill, 2025 is undeniably ambitious and forward-looking, its long-term success will depend on how effectively certain unresolved legal concerns are addressed. The Bill opens the nuclear sector in principle, but several structural, constitutional, and regulatory questions remain insufficiently settled. These concerns do not undermine the Bill's intent; rather, they highlight areas where legal clarity will be essential to avoid future litigation, regulatory paralysis, or investor hesitation.
11.1 Delegated Legislation and the Risk of Executive Overreach
One of the most significant legal concerns arises from the extensive reliance on delegated legislation. The SHANTI Bill empowers the Central Government to prescribe thresholds, conditions, safety parameters, liability caps, exemptions, and operational norms through rules and notifications. While such flexibility is understandable in a technologically evolving sector like nuclear energy, the breadth of delegation raises constitutional questions under Indian administrative law.
Indian courts have consistently held that essential legislative functions cannot be delegated without clear guiding principles. In the context of civil nuclear law, issues such as liability ceilings, permissible private sector activities, and exemptions from licensing are not merely procedural matters; they directly affect public safety, federal balance, and citizens' rights. If these critical elements are left largely to executive discretion, the Bill may face challenges on grounds of excessive delegation and lack of legislative guidance.
11.2 Regulatory Independence of the Atomic Energy Regulatory Board
Although the SHANTI Bill grants statutory recognition to the Atomic Energy Regulatory Board, questions remain about the depth of its independence. The regulator continues to function within the broader administrative ecosystem of the Department of Atomic Energy, which is also responsible for policy formulation and sectoral expansion.
This structural overlap creates a potential conflict of interest between promotion and regulation. In jurisdictions with mature nuclear sectors, regulatory independence is treated as non-negotiable, precisely because nuclear safety cannot be subordinated to capacity expansion targets. Unless the appointment process, funding autonomy, and decision-making independence of the AERB are clearly insulated from executive influence, stakeholders may question whether safety oversight is sufficiently robust. For private investors and international partners, perceived regulatory capture can become a material risk, particularly in high-liability sectors such as nuclear energy.
11.3 Interaction with Environmental and Land Laws
Another unresolved issue lies in the Bill's interface with India's environmental regulatory framework. Nuclear projects involve land acquisition, environmental impact assessments, coastal regulation approvals, and public hearings. The SHANTI Bill does not clearly articulate how its licensing regime will integrate with existing environmental statutes and judicial precedents.
Given the history of litigation around nuclear projects in India, ambiguity in environmental compliance pathways could delay project execution and expose developers to prolonged legal challenges. There is also a need to clarify whether nuclear installations will continue to be subject to public consultation norms under environmental law, or whether strategic considerations will limit such processes. In the absence of explicit harmonisation clauses, conflicts between nuclear licensing authorities and environmental regulators may arise, creating jurisdictional confusion.
11.4 Nuclear Liability, Insurance, and Victim Compensation
The introduction of a graded liability framework is commercially pragmatic, but it raises complex legal and ethical questions. While operator liability limits are now tailored to installation risk profiles, the Bill does not fully address how compensation will be ensured in catastrophic scenarios exceeding these caps.
The role of government backstops, insurance pools, and international reinsurance mechanisms remains unclear. In the event of a severe nuclear incident, delays or uncertainty in compensation could undermine public trust and provoke constitutional challenges based on the right to life and environmental protection.
There is also limited clarity on how supplier liability will be treated under contracts governed by Indian law, particularly in cross-border projects. This uncertainty could lead to disputes between operators, suppliers, insurers, and the State, especially where multiple jurisdictions are involved.
11.5 Central and State Government Role
Electricity generation and land acquisition are areas where both Central and State Governments exercise authority. While nuclear energy falls within the Central Government's legislative domain, project implementation inevitably requires cooperation from State Governments.
The SHANTI Bill largely sidelines the formal role of States in decision-making, licensing, and oversight. This centralised approach may create friction in federal relations, particularly where States raise environmental, safety, or rehabilitation concerns. Without structured consultation mechanisms, States may resort to administrative resistance or litigation, slowing project timelines. For a sector that requires local acceptance and long-term land use, cooperative federalism will be as important as statutory authority.
11.6 Private Sector Participation and Competition Law Concerns
As private participation expands, competition law considerations will become increasingly relevant. The nuclear sector, by its nature, tends toward concentration due to high entry barriers and capital intensity. The SHANTI Bill does not explicitly address how competition issues such as market dominance, preferential access to fuel, or vertically integrated operations will be monitored.
Absent clear safeguards, there is a risk that a few large players may dominate the nuclear supply chain, limiting innovation and distorting pricing. Coordination between nuclear regulators and competition authorities will be necessary to ensure that liberalisation does not inadvertently create private monopolies under state oversight.
11.7 Judicial Review and Dispute Resolution Effectiveness
While the Bill creates specialised dispute resolution bodies, questions remain about their independence, procedural transparency, and interaction with constitutional courts. The designation of the Appellate Tribunal for Electricity as the appellate authority is pragmatic, but nuclear disputes often involve issues beyond tariff and infrastructure, including safety, liability, and environmental harm.
The extent to which affected communities, civil society groups, and non-commercial stakeholders can access these forums remains unclear. If remedies are perceived as inaccessible or biased toward operators, constitutional litigation before High Courts and the Supreme Court is likely to increase.
- Long-Term Policy Stability and Investor Confidence
Finally, the SHANTI Bill's success depends on policy continuity. Nuclear projects have lifecycles spanning several decades. Investors will closely scrutinise whether future governments can substantially alter liability regimes, participation thresholds, or regulatory conditions through executive action.
- Conclusion: A New Chapter with Cautious Optimism
India's civil nuclear law is undergoing its most significant transformation in decades. The SHANTI Bill, 2025 represents a conscious attempt to reposition nuclear energy as a cornerstone of India's clean-energy future. By modernising regulation, enabling private participation, rationalising liability, and strengthening safety oversight, the Bill opens a new chapter in the energy sector.
Yet, this transition must be managed with legal precision. Regulatory clarity, institutional independence, and public trust will determine whether nuclear energy emerges as a reliable pillar of India's energy security or remains constrained by implementation challenges.
On successful implementation, the SHANTI Bill has the potential to redefine India's civil nuclear law not merely as a strategic instrument, but as a catalyst for sustainable growth, technological leadership, and long-term energy resilience.
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