SHANTI ACT, 2025

After Reading This Article You Can Solve This UPSC Mains Model Question:

“The SHANTI Act marks a structural shift in India’s nuclear energy governance.”
Discuss its objectives, key provisions, and significance, and critically analyse the concerns related to nuclear safety, liability, and regulatory independence. Suggest a way forward to ensure balanced and sustainable nuclear expansion in India. (GS-2 Infrastructure)

About the sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025

The SHANTI Act is a landmark piece of legislation introduced to modernize India’s nuclear energy sector. It seeks to repeal and replace the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage (CLND) Act, 2010.

Primary Objective: To end the 60-year state monopoly and allow the entry of domestic private capital and joint ventures in building and operating nuclear power plants.
Target: Facilitates the government’s ambitious goal of reaching 100 GW of nuclear capacity by 2047.
Scope: Opens up the value chain including reactor construction, plant operations, and equipment manufacturing, while keeping sensitive “fuel cycle” activities (enrichment, reprocessing) under exclusive state control.

Role of the Atomic Energy Regulatory Board (AERB)

1. Statutory Status and Independence

Legal Backing: The AERB now derives its power directly from the SHANTI Act rather than executive orders. This provides it with “institutional permanence.”
Parliamentary Accountability: To ensure transparency, the AERB is now accountable to Parliament. It must submit annual reports directly to the legislature, reducing the potential for “regulatory capture” by the DAE or private operators.
Financial & Technical Autonomy: The Bill grants the board administrative and financial powers to hire global experts and fund independent safety research without seeking approval from the nuclear operators it regulates.

2. Licensing and Safety Authorization

Multi-Stage Review: The AERB is mandated to conduct safety reviews at every stage: Siting, Design, Construction, Commissioning, and Operation.
Five-Year License Renewal: Unlike the older regime, operating licenses must now be renewed every five years, subject to a rigorous “Periodic Safety Review” (PSR).
Private Sector Oversight: For the first time, the AERB will regulate private Indian companies and Joint Ventures entering the nuclear sector.

3. Expanded Mandate under SHANTI Bill

Small Modular Reactors (SMRs): Developing specific safety codes and standards for the “Bharat Small Reactor” and other modular designs.
Non-Power Applications: Regulating radiation safety in healthcare (nuclear medicine), agriculture (food irradiation), and industrial AI-enabled technologies.
Environmental Restoration: The AERB is now responsible for ensuring “environmental remediation” after a plant is decommissioned.

4. Enforcement and Transparency

Search and Seizure: The Board is granted enhanced powers for inspection, investigation, and even the “sealing of facilities” if safety norms are violated.
Public Outreach: The Bill explicitly tasks the AERB with keeping the public informed about radiological safety and emergency preparedness.
Cyber Security: The AERB, in coordination with national agencies, will audit the multi-layered digital safeguards and encryption used in nuclear control systems.

Safeguards and Liability Clause

1. Liability Clause: Graded and Capped

The Bill moves away from the “one-size-fits-all” model of the CLND Act, 2010 to a Graded Liability Structure. This is designed to reflect the actual risk profile of different reactor technologies.

Category	Reactor Type / Capacity	Operator Liability Cap
Large Reactors	>3600 MWth	₹3,000 Crore
Standard Reactors	1500 – 3600 MWth	₹1,500 Crore
Small Modular (SMRs)	<150 MW / Research Reactors	₹100 Crore
Fuel Facilities	Spent Fuel Reprocessing	₹300 Crore

Key Changes to “Right of Recourse”

Under the old law, operators had a statutory right to sue suppliers for defective equipment (Section 17). The SHANTI Bill changes this significantly:

Removal of Automatic Supplier Liability: Suppliers are now shielded from automatic legal action. An operator can only claim damages if:
- It is explicitly written in a private contract.
- There is proof of an individual’s intent to cause damage.
Reasoning: This aligns India with the international Convention on Supplementary Compensation (CSC) and removes the “policy paralysis” that prevented companies like Westinghouse (USA) and EDF (France) from building plants in India.

2. Safeguards: Strategic and Regulatory

Strategic Safeguards

Fuel Cycle Monopoly: The Central Government retains exclusive control over Uranium Enrichment, Heavy Water Production, and Spent Fuel Reprocessing. Private players can build the “engine” (the reactor), but the government owns the “fuel.”
Section 39 (Information Control): The government can declare wide categories of information—design, material transport, and siting—as “Restricted Information.” This explicitly overrides the RTI Act, 2005 to prevent sensitive data from being leaked.

Regulatory Safeguards

Mandatory Insurance: Private operators must maintain insurance or financial security to cover their liability cap. Central Government installations remain exempt as the state is the ultimate insurer.

Two-Tier Penalty System:
- Monetary Penalties: For administrative or minor safety lapses.
- Imprisonment: For grave offenses or criminal negligence.

3. Victim Compensation and Redressal

Operator Payout: The first layer comes from the operator’s insurance (up to the cap).
Nuclear Liability Fund: A central fund created by the government to cover damages that exceed the operator’s cap.
Nuclear Damage Claims Commission: A specialized body to adjudicate compensation claims quickly, bypassing slow civil courts.

Significance and Government Viewpoint

1. Strategic Significance

Ending State Monopoly: By repealing the 1962 Act, the Bill ends the exclusive control of the Nuclear Power Corporation of India (NPCIL), allowing private Indian companies to build and operate reactors.
Energy Security: Nuclear is being repositioned as a “clean baseload” source to complement intermittent renewables (solar/wind). It provides 24/7 stable power required for green hydrogen production and data centers.
Viksit Bharat 2047: The Bill is the legal vehicle to reach the target of 100 GW of nuclear capacity by 2047, up from the current ~8 GW.
Global Alignment: By removing the “automatic right of recourse” against suppliers, India aligns its liability laws with the Convention on Supplementary Compensation (CSC), potentially reviving stalled deals with the US (Westinghouse) and France (EDF).

2. Economic and Industrial Significance

Capital Mobilization: Reaching 100 GW requires an estimated ₹15–20 lakh crore. The Bill allows private giants (like Tata, Reliance, or Adani) and Joint Ventures to infuse the necessary capital.
SMR Ecosystem: The Bill facilitates the Bharat Small Reactor (BSR) program. Small Modular Reactors (SMRs) are seen as “factory-built” units that can be deployed quickly for captive industrial use in steel and cement sectors.
Supply Chain Growth: It encourages domestic manufacturing of high-precision nuclear components, creating a high-tech industrial ecosystem and millions of skilled jobs.

3. Government’s Viewpoint

Pragmatic Reform: The Centre views the liability cap and supplier immunity not as a dilution of safety, but as a “pragmatic trade-off” to make nuclear projects insurable and bankable.
Sovereign Control: The government insists that Strategic Autonomy is maintained because “sensitive” fuel cycle activities (enrichment and reprocessing) remain a 100% state monopoly.
Infrastructure Status: The government now treats nuclear power as a core infrastructure sector rather than a secretive strategic asset, allowing for better credit flow and regulatory clarity.

Government Schemes: India’s Nuclear Energy Mission

1. Key Features of the Mission

Financial Outlay: A dedicated allocation of ₹20,000 crore focused on the research, development, and deployment of nuclear technologies.
Target 2047: The mission aims to scale India’s nuclear capacity from the current ~8 GW to 100 GW by 2047, contributing to nearly 10% of India’s total energy mix.
Small Modular Reactor (SMR) Focus: Unlike traditional missions that focused on massive 700 MWe plants, this mission prioritizes SMRs for faster deployment and industrial use.

2. The Two-Pronged Strategy

A. Large-Scale Expansion (Greenfield)

Large Reactors: Establishing 700 MWe indigenous Pressurized Heavy Water Reactors (PHWRs) and large capacity imported reactors (e.g., in collaboration with USA and France).
Indigenous 700 MWe PHWRs: Rapidly scaling the proven design used at Kakrapar (KAPS-3 & 4) across approved sites.

B. Small & Modular Deployment (Brownfield)

Bharat Small Reactor (BSR): Based on the proven 220 MWe PHWR technology. These are designed for captive power in energy-intensive industries (Steel, Aluminum).
Bharat Small Modular Reactor (BSMR-200): An advanced 200 MWe light-water reactor design currently under development by BARC.
Repurposing Thermal Plants: A unique objective of the mission is to replace retiring coal-based power plants with SMRs, utilizing existing land, water, and grid infrastructure.

3. Innovative Public-Private Partnership (PPP) Model

Private Role: Domestic private companies provide the land, cooling water, and capital.
Government Role: NPCIL (Nuclear Power Corporation of India) manages the design, quality assurance, and technical operations.
Outcome: Private entities receive a stable, long-term supply of low-carbon “captive” power, while the state ensures safety and strategic control.

4. Non-Power Goals of the Mission

Green Hydrogen: Development of high-temperature gas-cooled reactors (up to 5 MW) specifically for hydrogen generation to decarbonize the transport sector.
Closed Fuel Cycle: Accelerating the Prototype Fast Breeder Reactor (PFBR) at Kalpakkam to eventually unlock India’s vast Thorium reserves

Challenges

1. Legal and Regulatory Challenges

Dilution of Supplier Liability: The removal of the “automatic right of recourse” against equipment suppliers (from the 2010 Act) is a major point of contention. Critics argue this “shields” foreign vendors from accountability in case of design flaws, potentially placing the entire safety and financial burden on the Indian state and the operator.
Regulatory Capacity: As the sector opens to private players, the AERB (now statutory) will need to scale its workforce and technical expertise exponentially to monitor multiple private sites simultaneously.
Transparency vs. Secrecy: Section 39 allows the government to classify data as “restricted information.” Critics fear this could be used to bypass the RTI Act, limiting public oversight on safety audits and environmental impacts.

2. Financial and Economic Hurdles

High Capital Intensity: Nuclear plants are extremely expensive to build, with costs estimated at ₹14–15 crore per MW. Finding “patient capital” (long-term investment) in a market that prioritizes quick returns is difficult for private firms.
Gestation Periods: Nuclear projects typically take 8–12 years to become operational. For private investors, this leads to high “Interest During Construction” (IDC) and risk of cost overruns.
Lack of Tariff Guarantees: Unlike solar or wind, there is currently no standardized “feed-in tariff” or viability gap funding (VGF) for nuclear power, making revenue predictability a challenge.

3. Technical and Infrastructure Challenges

Spent Fuel Management: India still lacks a permanent Deep Geological Repository (DGR) for high-level radioactive waste. While the Bill says waste remains under state control, the sheer volume from 100 GW of capacity will create a massive logistical and environmental burden.
Grid Integration: Adding 100 GW of “inflexible” baseload power requires a massive upgrade of the national grid. The grid must be able to balance this steady supply with the “intermittent” peaks of solar and wind.
SMR Commercialization: While the Bharat Small Reactor (BSR) is a goal, the technology is still in the pilot phase. Moving from design to mass manufacturing within the government’s 2032-2047 timeline is technically ambitious.

4. Social and Political Challenges

Public Perception and “Social License”: Past protests at Kudankulam and Jaitapur show that local communities remain fearful of radiation and displacement. The Bill does not mandate community consultation, which could lead to fresh legal battles.
Federal Concerns: Since land and water are state subjects, any friction between the Centre and State governments can stall projects indefinitely, regardless of the new Federal law.

Way Forward

1. Strengthening Regulatory Independence

Empowering the AERB: While the Bill grants statutory status, the AERB must be provided with budgetary independence (funded through a levy on power generation rather than DAE grants) to ensure it can hire top-tier global safety experts.
Transparency Dashboards: To counter the “RTI override” concerns in Section 39, the AERB should launch real-time public dashboards for radiation monitoring and safety audit summaries, building “social license” through transparency.

2. The “Coal-to-Nuclear” (C2N) Pivot

Brownfield Conversion: The government has identified 10 retiring thermal power plant sites (e.g., Wanakbori in Gujarat) for conversion. This strategy should be fast-tracked to leverage existing land, water access, and transmission grids, bypassing the “land acquisition” hurdle.
SMR Clusters: These sites are ideal for Small Modular Reactors (SMRs), which can be deployed in modules to match the decommissioned coal capacity.

3. Financial and Market Engineering

Nuclear Insurance Pool 2.0: With the shift to contractual liability, the existing Indian Nuclear Insurance Pool (INIP) needs to be expanded to cover private operators and foreign vendors at competitive premiums.
Green Bonds for Nuclear: Given that nuclear is now recognized as a “clean baseload,” the government should allow nuclear projects to tap into ESG (Environmental, Social, and Governance) funds and issue sovereign green bonds.

4. Closing the Fuel Cycle & Waste Management

Deep Geological Repository (DGR): India must move beyond “interim storage.” A priority for the next decade is identifying and certifying a permanent underground repository for high-level waste, following IAEA’s roadmap.
Thorium Roadmap: Accelerating the Stage-2 (Fast Breeder) and Stage-3 (Thorium) reactors is essential to reduce long-term dependence on imported Uranium.

5. Human Capital and Skill Development

Nuclear Innovation Hubs: Establishing dedicated nuclear engineering programs in top IITs and specialized training academies to create a workforce for the private sector, which will need thousands of certified operators by 2035.

Conclusion

The SHANTI Bill signals a forward-looking shift towards a regulated partnership model in nuclear energy, enabling clean, reliable baseload power for India’s future. With a strong, independent safety regulator and transparent liability mechanisms, it can drive advanced reactors, indigenous manufacturing, and high-skill jobs. Its success, however, hinges on balancing investment facilitation with uncompromised safety and public trust, making nuclear energy a responsible pillar of Viksit Bharat @2047.