SHANTI Bill 2025: Opening India’s Nuclear Sector

Why in News ?

Parliament has passed the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025, fundamentally restructuring India’s nuclear power framework by allowing private participation in nuclear power plant operations and related activities.

Background and Context

India’s nuclear power sector has historically been state-dominated, governed by the Atomic Energy Act, 1962, with operational control vested in public sector entities. While nuclear energy is crucial for clean baseload power, capacity expansion has remained slow due to capital intensity, liability concerns, and limited public resources.

With India targeting 100 GW of nuclear power capacity by 2047—to meet climate commitments and energy security needs—the government argues that private investment and technology partnerships are essential. The SHANTI Bill seeks to modernise the legal framework to align nuclear power with India’s broader infrastructure and clean energy ambitions.

Private Sector Entry under SHANTI Bill, 2025

Expanded Participation

• Allows public and private companies to set up and operate nuclear power plants
• Permits private involvement in:
  • Transport and storage of nuclear fuel
  • Import/export of nuclear equipment and technology
  • Handling of specified nuclear materials (non-sensitive segments)

Strict Safety and Regulatory Oversight

• Mandatory authorisation from the Atomic Energy Regulatory Board (AERB)
• Regulatory approval required for:
  • Manufacture, possession, transport, and disposal of radioactive materials
  • Establishment, operation, and decommissioning of nuclear and radiation facilities

Foreign Investment: Conditional Access

• No explicit allowance for Foreign Direct Investment (FDI)
• Participation possible only through Central Government notification
• Expected alignment with DPIIT foreign equity norms, subject to security considerations

Activities Reserved for the State

Certain sensitive functions remain exclusively under Central Government control, including:

• Uranium enrichment and isotopic separation
• Reprocessing of spent fuel and management of high-level nuclear waste
• Production and upgradation of heavy water

Accountability and Liability Framework

Dilution of Supplier Liability

• Removes the automatic “right of recourse” against equipment suppliers present under the CLNDA, 2010

• Operators can claim damages from suppliers only if:

• Explicitly provided through written contracts, or

• Criminal intent to cause nuclear damage is established

Implication: This shields suppliers from long-term liability linked to latent defects, addressing investor concerns but raising accountability issues.

Graded Liability Caps

• Replaces the flat ₹1,500 crore liability cap
• Introduces capacity-based graded liability, reflecting differing risk profiles of nuclear installations

Insurance and Financial Security

• Mandatory insurance applies only to private operators
• Government-owned installations are exempt
• Provision for a Nuclear Liability Fund to meet compensation obligations of the Centre

Enhanced Penalty Structure

• Two-tier framework:
  • Monetary penalties for minor violations
  • Imprisonment for serious offences
• Marks a shift toward graduated enforcement absent in earlier laws

Transparency and RTI Concerns

Section 39: Overriding RTI Act

• Empowers the Centre to declare broad categories of nuclear-related information as “restricted”
• Such information becomes fully exempt from disclosure, overriding the RTI Act, 2005

Why This Is Controversial

• RTI Act exemptions are conditional and subject to:
  • Appeals
  • Public interest override (Section 8(2))
• Section 39 removes these safeguards entirely

Concerns Raised:

• Institutionalised secrecy
• Reduced public oversight as private players enter the sector
• Weakened whistleblower protection and independent scrutiny