iNTRODUCTION
The nuclear space in India is undergoing some
serious regulatory transformations. Parallel with the regulatory
shifts in India's space sector, the key issues which will spring up
are governance challenges. In this context, the release of the draft rules under
the SHANTI Act by the Department of Atomic Energy is worth
examining.
To ensure the target of reaching 100 GW nuclear power capacity
is reached by 2047, the key requirement will be a robust, fully
independent regulatory framework, modelled after bodies like SEBI or
TRAI. This would ensure the Atomic Energy Regulatory Board
(AERB) operates without conflict of interest.
The AERB has the scope to work out creatively solutions to
challenges like that of ensuring long-term sustainability and
investor confidence, specifically regarding corporate foreign investor
protection (ISDS mechanisms), and guard against excessive civil society
interference which does not stay limited to environmental
safeguards but rakes up often non-sequitur issues.
Our coverage in the mid-December 2025 CRG Report on the Lok Sabha passing the SHANTI Bill,
2025 (Sustainable Harnessing and Advancement of Nuclear Energy for
Transforming India) discussed some of these.
HIGHLIGHTS OF THE DRAFT
RULES
● Mandatory
Financial Security: Nuclear plant operators must maintain an
insurance policy, financial security or a combination of both for
nuclear damage.
● Periodic
Liability Reviews: The Central Government must, once every five
years, constitute a group of experts to review the maximum limits of
an operator's civil liability for nuclear damage.
● Strict
Certification for Foreign Reactors: If
a nuclear power plant or reactor is of a foreign design, its design should be
certified or approved in the country of origin by its regulatory body.
● Single Composite
License: There will be a single composite licence authorising the building,
owning, operating and decommissioning of the nuclear power plant or
reactor.
SIGNIFICANCE OF THE BILL
● The Bill
marks a landmark transition in India's nuclear energy strategy, dismantling a
state monopoly that has lasted over 60 years, by allowing Indian private
companies to build, own, and operate nuclear power plants.
● The Bill
provides a roadmap to achieve 100 GW of nuclear capacity by 2047. While it
invites private investment and international technology, the government maintains a
firm grip on critical "strategic" operations, such as fuel enrichment
and waste management.
● There is a
Regulatory overhaul as the bill formally establishes the Atomic
Energy Regulatory Board (AERB) with statutory status, granting it greater
autonomy to set safety standards and enforce inspections across both power and
non-power (healthcare, agriculture) applications. A dedicated tribunal will be
created to resolve sector-specific disputes, excluding
the jurisdiction of civil courts to ensure faster legal resolutions.
● In an assessment
by credit rating agency, Fitch (BMI), it mentioned SHANTI Act will significantly
accelerate the deployment of nuclear power in the country. It would not only
open the door to private & foreign capital but also lower the
capital cost for nuclear power developments in India, making projects cheaper
to fund. The legal liability too has been restructured to remove the
uncertainties that previously deterred international reactor suppliers and
domestic private players. Finally, granting independent statutory authority to
the AERB strengthens the regulatory aspects.
OPPORTUNITIES FOR THE PRIVATE SECTOR
● The opening up of the
sector to private players provides an enormous opportunity for
India to regain the leadership in nuclear technology. Naturally the AERB
will have adequate regulatory powers and show transparency to supervise this
complex sector as well as educate the public against misinformed campaigns that
can become viral. Nuclear offers the best route to weed out fossil fuel and
help the world clean up the energy pipeline. Just depending on solar etc has
its limitations and so technologies like Small Modular Reactors in the nuclear
field are essential in this quest.
● During January 2026,
Mr Jitendra Singh,
Minister of State for Department of Atomic Energy & PMO said at the ET Roundtable, adding that he was quite "flattered" to learn
that the new act was
now the priority item of discussion for the US with India. "There is a
growing interest from
the private sector
and also from foreign collaborators.
Like, incidentally, when the US Secretary of State was holding parleys with our
Minister of External Affairs recently, he chose to talk about the SHANTI Act rather
than anything else.
CONCLUSION
The SHANTI Bill is one of the boldest reforms undertaken by India
in recent past. Given its critical importance to the safety and security of
India, it takes a lot of effort to open this sector to
private bodies after six decades of complete Government
control. Simultaneously, a parallel deregulation in the Space
sector mirrors a deliberate macro-shift toward private-led infrastructure
growth.
However, to successfully
navigate India’s historic transition from a state monopoly to a private-led
nuclear and space framework, the government must adopt a proactive,
multi-pronged regulatory strategy that balances rapid infrastructure growth
with public interest.
Powers of the Regulatory body: Apart from statutory powers, AERB must be given full operational
and financial independence like
SEBI or TRAI to function effectively and
independently – without undue Government interference. Regulators need full powers to supervise this complex
sector, show transparency with strong focus on education of citizens to counter any false campaign.
Governance of regulators
should be streamlined to avoid creating too many regulatory bodies across different
levels of government. Overlapping jurisdictions and
excessive regulatory tiers should be minimized to prevent operational
inefficiencies, confusion, and bureaucratic delays.
Environmental and Resource issues: The rapid expansion of energy-intensive AI
data centres across the country have prompted ties to
nuclear energy facilities. That has brought into picture the rising need
for resource planning to resolve competing demands for local water and
land resources.
Robust environmental laws must be enacted to prevent and manage
potential disasters.
Attracting Capital: A robust corporate foreign investor
protection framework needs to be developed that will generate
confidence among foreign sector participants and bring in more
investments in the sector. India can bridge foreign capital apprehensions
by establishing a modernized Investor-State Dispute Settlement (ISDS)
mechanism for high-risk infrastructure and enshrining explicit statutory
protections for citizens' rights, ensuring that market-led expansion is matched
by institutional trust, ecological safety, and international investor
confidence.
Protection
of citizens’ rights: Private sector participation brings with it more
responsibilities towards protecting rights of citizens. The Draft Bill should
be implemented in the right earnest.
