India’s push for nuclear energy can support climate goals but ground execution will determine its impact

The Act heralds three transformative shifts. First, it opens the door for private sector participation in nuclear power generation, equipment manufacturing and fuel-cycle services. Second, it attempts to rationalize India’s nuclear liability regime that deterred foreign suppliers and investors. Third, it makes space for advanced nuclear technologies, such as modular reactors (SMRs) and next-generation reactors.

So far, nuclear power has been the preserve of public sector entities like Nuclear Power Corporation of India Ltd (NPCIL). Rooted in national security considerations, this policy constrained India’s access to capital and innovation.

Now private players would be able to forge partnerships, form joint ventures and play manufacturing roles, while the state retains control over sensitive aspects of the fuel cycle.

This calibrated liberalization acknowledges that public finance alone cannot support the scale of nuclear capacity required for a low-carbon economy. From a private investor’s perspective, this legislative change is welcome but not sufficient.

Nuclear projects are capital-intensive with long gestation periods. Their viability depends on predictable tariffs, long-term power purchase agreements and the assurance of contract enforcement. Subordinate legislation on pricing mechanisms, offtake guarantees and dispute resolution would help attract private investment.

A politically sensitive aim was to undo the deterrent introduced by the Civil Liability for Nuclear Damage Act of 2010, which allowed plant operators to sue suppliers over mishaps.

The new law, which subsumes that law, seeks to rationalize supplier exposure with the objective of aligning India’s liability regime more closely with global practices while preserving safeguards and the rights of victims. This is a delicate balancing act, as perceptions of diluted accountability could provoke public resistance.

The government needs to communicate clearly how the revised framework would hold operators accountable and how it is designed to protect citizens and ensure prompt compensation through insurance pools and other mechanisms.

The Act explicitly recognizes technologies like SMRs, which promise lower upfront costs, enhanced safety features and flexible deployment—attributes well suited to India’s energy needs. Prospects of distributed SMR deployment near load centres (like industrial clusters) open up exciting possibilities for integrating nuclear power with India’s broader industrial decarbonization agenda.

This optimism must be tempered by the fact that SMRs are still largely at their demonstration stage, globally. Regulatory capacity, supply chains and human resource skills will need substantial strengthening for their deployment.

Our nuclear regulatory framework was designed for large reactors operated by a single public entity. A future involving multiple reactor designs and private operators will require us to not just empower the Atomic Energy Regulatory Board (AERB) as an institution, but ensure its autonomy. It must have the resources it needs to oversee a far more complex and diversified nuclear ecosystem.

Without strengthening the AERB, the whole mission to multiply our nuclear generation capacity could come apart.

From a climate policy perspective, nuclear energy offers low-carbon power that can complement intermittent renewables and thereby strengthen grid stability. The Act takes India’s net-zero goal into view, but nuclear energy would benefit from clearer integration with broader power sector reforms. For nuclear reactors to be treated as climate infrastructure, they must fit into climate finance frameworks without ambiguity, so that projects can compete for patient capital and green funding. Power offtake assurances would be helpful here.

Finally, we cannot overlook the social dimension of nuclear energy. Many projects in India have faced resistance on account of perceived opacity.

International experience suggests that early community engagement, benefit-sharing mechanisms and safety disclosures are essential for popular acceptance. Embedding these principles in regulation would bolster both project viability and public confidence.

Perhaps an office of public advocacy could disseminate information, address apprehensions and take up credible concerns with policymakers and regulators. This would go a long way in enlisting public support for nuclear projects.

The Act’s success in making nuclear power integral to India’s clean-energy transition will depend on the investments it results in and the innovations that come to bear. The risks lie in execution—regulatory certainty, contractual clarity and institutional capacity. It can prove transformative if what’s on paper unfolds well on the ground.

The authors are partners, JSA Advocates & Solicitors.