The SHANTI Act stands for the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025. It creates a consolidated legal framework for India's civilian nuclear energy sector, including nuclear power generation and non-power applications of nuclear technology. The Act received presidential assent in December 2025.
Need of the Act
1. Outdated and fragmented laws: Atomic Energy Act, 1962 and Civil Liability for Nuclear Damage Act, 2010 were designed for a largely state-controlled sector and did not adequately address modern technologies and needs.
- The Atomic Energy Act, 1962 (AEA) had become outdated because it treated nuclear energy almost entirely as a state monopoly, thus did not support private investment.
- The Civil Liability for Nuclear Damage (CLND) Act, 2010 has provisions like supplier recourse and Uncapped parallel liability deterred private and foreign suppliers.
Supplier recourse: Operators could seek reimbursement from suppliers for incidents caused by defective equipment, latent defects, or sub-standard services. This exposed suppliers to potentially large, uncertain liability and discouraged foreign vendors. |
2. Rising electricity demand: digitalisation, data centres and advanced manufacturing increase the demand for electricity, renewables alone are variable and cannot fully meet this need.
- India aims to achieve 100 GW of nuclear capacity by 2047 under the Nuclear Energy Mission
- India's current installed nuclear energy capacity is just 8.78 GW.
- Nuclear power generates approximately 3.1% of India's total electricity mix.
Main Objectives
- Provide a legal framework for the development and peaceful use of atomic energy
- Position nuclear power as a low-carbon baseload source to support India’s energy security, Sustainable Development Goals, and Net Zero by 2070 commitment.
- Permit eligible private entities, joint ventures, and state governments to participate.
- Encourage research and innovation
- Bring India’s civil nuclear framework into conformity with national and international obligations
Key Provisions of the Shanti Act
The SHANTI Act, 2025 aims to modernise India’s civil nuclear framework and enable safe private participation while retaining state control over strategic nuclear activities. It repeals the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010.
1. Private-sector participation in nuclear energy: With the Act monopoly of NPCIL and BHAVINI will end. The act allows private companies and other eligible entities to participate in activities such as:
- Construction, ownership and operation of nuclear power plants
- Generation of nuclear electricity
- Manufacture of nuclear equipment and components.
- Decommissioning of nuclear installations
2. Strategic activities remain under government control: The Act maintains government control over sensitive parts of the nuclear fuel cycle like:
- uranium enrichment and isotopic separation activities
- Management of spent nuclear fuel
- Handling of high-level radioactive waste.
- Production and upgradation of heavy water
Retaining state control over sensitive operations seeks to balance commercial participation with national security.
3. Statutory status for the Atomic Energy Regulatory Board (AERB): The act grants statutory recognition to the Atomic Energy Regulatory Board (AERB) to strengthen nuclear safety oversight.
4. Revised nuclear liability and compensation framework: The SHANTI framework revises the earlier civil liability regime through the following elements.
- No-fault liability principle: The operator's liability is structured so that compensation does not depend entirely on proving conventional negligence or fault.
- Graded operator liability: the framework provides different liability limits according to the category and characteristics of the nuclear installation.
- Small Modular Reactors (SMRs) / Small Plants: ₹100 crore
- Medium Plants: ₹1,500 crore
- Large Plants: Up to ₹3,000 crore
- Overall Maximum Liability: Capped at 300 million Special Drawing Rights (SDR) (approx. ₹3,900 crore)
- Government's role: The framework provides for the Central Government to meet liability beyond the applicable operator limit.
5. Changes to supplier liability: Under Section 17 of the earlier Civil Liability for Nuclear Damage Act, 2010, an operator could exercise a right of recourse against a supplier in specified circumstances, including certain defects in equipment or material and certain contractual arrangements.
The SHANTI framework changes this position by removing the earlier statutory supplier-recourse provision, Recourse is linked to the grounds permitted under the new framework.
6. Regulation of non-power applications: It also provides a framework for peaceful uses of nuclear science and radiation technologies in sectors such as healthcare, agriculture, industry and research.
7. Dispute resolution and appeals: The legislation provides institutional mechanisms for resolving disputes and hearing appeals.
- An Atomic Energy Redressal Advisory Council for specified disputes.
- Claims Commissioners and a Nuclear Damage Claims Commission for the adjudication of nuclear-damage compensation claims.
8. Support for Small Modular Reactors (SMRs): Shanti act also supports the wider technology adoption like Small Modular Reactor. India targets for at least five indigenously designed SMRs to be operational by 2033.
Major Concerns and Challenges with the Act
The Act may improve investor confidence and speed up nuclear expansion but it weakens accountability and responsibility.
- Weak supplier accountability: The Act removes the automatic statutory right of recourse against suppliers for defective equipment. Critics argue this may reduce safety incentives for equipment manufacturers and leave the public to bear residual risk.
- Inadequate liability caps: Operator liability is capped from ₹100 crore to ₹3,000 crore depending on reactor size. Critics contend that this may be far below the actual cost of a severe nuclear accident.
- Dilution of the "Polluter-Pays" Principle: Removing supplier liability and capping operator liability shifts the financial burden of a catastrophic accident onto the state and taxpayers, weakening accountability for faulty engineering.
- AERB independence concerns: Although AERB now has statutory status, petitioners and experts question the process for appointing and removing its Chairperson and members.
- Limited transparency: The Act empowers the Union Government to restrict publication of information and provides exemptions from the Right to Information Act, 2005 for nuclear power stations.
The SHANTI Act represents a necessary shift from a state-monopoly model to a regulated, investment-friendly, and innovation-driven nuclear ecosystem. If implemented with strong safety safeguards, transparency, and public accountability, it can position nuclear energy as a reliable pillar of India’s Net Zero by 2070 and Viksit Bharat 2047 goals; otherwise, the benefits of private participation may come at the cost of weakened liability, public trust, and environmental justice