What legislative reforms are necessary to enable private sector participation in India's nuclear power sector? Discuss associated challenges.

Q. What legislative reforms are necessary to enable private sector participation in India's nuclear power sector? (15 marks, 250-350 words)

India targets 100 GW of nuclear capacity by 2047 [3], but atomic energy remained a near-state monopoly under the Atomic Energy Act, 1962. Private entry therefore hinged on statutory change — in licensing, liability and regulation — rather than on policy intent alone.

Reforms necessary (and now legislated) - Widening licensing: the SHANTI Act, 2025, passed in December 2025 to replace both the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010 [4], permits licences to Indian-incorporated companies and to joint ventures between government entities and private firms [1]. - Rationalising liability: the flat ₹1,500 crore operator cap is replaced by a tiered ₹100–3,000 crore cap linked to reactor capacity, and the operator's right of recourse against suppliers — the single biggest deterrent to supplier entry — is removed [1]. - Independent regulation: the AERB gains statutory recognition, with an Atomic Energy Redressal Advisory Council for appeals [1]. - Opening the fuel cycle: the DAE Task Force (with AERB, NPCIL, NITI Aayog, MoLJ, MEA) examined build-own-operate models, fuel fabrication, safeguards, waste management and reprocessing [2].

Associated challenges - Compensation versus capital: removing recourse and capping liability comforts investors but shifts residual risk to the operator and, ultimately, the exchequer and victims. - Regulatory autonomy: statutory status does not by itself insulate AERB from a department that simultaneously promotes and operates nuclear power. - Limited foreign capital: companies incorporated outside India remain ineligible for licences [1], constraining technology and financing inflows. - Safety, security and safeguards in private hands demand new inspection capacity and trained manpower. - Project economics: high capital costs, long gestation, land acquisition and public acceptance persist; the ₹20,000 crore Nuclear Energy Mission, targeting five indigenous SMRs by 2033 [3], needs clear siting and tariff rules to attract takers.

Legislative opening is a necessary first step, not a sufficient one. Credible subordinate rules on licensing, insurance pooling and regulatory independence will determine whether private capital actually flows — turning nuclear power into a dependable pillar of India's net-zero-by-2070 clean energy transition.

(~330 words)

Sources: 1. The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025 — PRS Legislative Research — replacement of the 1962 and 2010 Acts, private/JV licensing, tiered liability caps, removal of recourse, statutory AERB, exclusion of foreign-incorporated companies 2. PARLIAMENT QUESTION: NUCLEAR ENERGY MISSION, PIB (Department of Atomic Energy) — DAE Task Force composition and its scope covering build-own-operate, fuel fabrication, safeguards, waste and reprocessing 3. Nuclear Power in Union Budget 2025-26, PIB (Department of Atomic Energy) — 100 GW by 2047 target; Nuclear Energy Mission with ₹20,000 crore outlay and five indigenous SMRs by 2033 4. Dr. Jitendra Singh Tables the SHANTI Bill, 2025 in Parliament, PIB — introduction and passage of the Bill in Parliament