India's newly enacted Shanti Act presents a significant opportunity for American firms to engage in the country's rapidly expanding nuclear energy sector, according to Vinay Mohan Kwatra, India's envoy. The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025, passed by Parliament in December, repeals the Atomic Energy Act of 1962 and the Civil Liability for Nuclear Damage Act of 2010, effectively ending the state's monopoly on nuclear power generation. This opens the door for private and foreign participation in uranium mining, reactor construction and operation, equipment manufacturing, and other aspects of the nuclear fuel cycle, subject to licensing and regulatory oversight.
The Shanti Act allows foreign direct investments up to 49%, enabling private players to form partnerships and joint ventures. This legislative shift aligns with the Nuclear Energy Mission, announced in the Union budget for 2025-26, which aims to achieve 100 gigawatts (GW) of installed nuclear capacity by 2047. Currently, nuclear power accounts for approximately 3% of India's total installed electricity capacity, with 25 reactors operating across seven sites, generating 8.8 GW.
Several agreements between the National Thermal Power Corporation (NTPC) Limited, a state-owned company, and foreign firms signal the changing landscape. NTPC has inked deals with Russia's Rosatom, France's Électricité de France SA (EDF), and the US' Clean Core Thorium Energy to explore collaborations for nuclear power projects in India.
The Shanti Act also restructures India's nuclear liability regime, capping liability at 300 million Special Drawing Rights (SDRs), which is approximately US $430 million. Liability beyond this amount is assumed by the Central Government. The Act retains the Atomic Energy Regulatory Board (AERB) as the primary regulator, overseeing approvals and licenses. The government, with AERB approval, can exempt any plant, facility, substance, or technology from licensing or liability requirements if the assessed risk is deemed "insignificant".
While proponents tout the Shanti Act as a clean energy reform, critics have raised concerns about safety and liability, particularly regarding the liability cap. The Act strengthens India's position in the global nuclear ecosystem and reinforces its bid for membership in the Nuclear Suppliers Group (NSG). It is intended to correct the perception that India was commercially hostile to foreign suppliers under the previous liability framework. The Act grants statutory status to the AERB, empowering it to inspect facilities, investigate incidents, issue binding directions, and suspend or cancel operations for non-compliance. Safety oversight is embedded across the lifecycle of nuclear facilities.
