India’s Nuclear Policy

Recent proposed amendments to key nuclear legislations notably the Civil Liability for Nuclear Damage Act (CLNDA), 2010 and the Atomic Energy Act (AEA), 1962 have sparked intense debate in Parliament. These changes aim to address long-standing concerns around supplier liability, enable private sector participation, and align India’s nuclear laws with international frameworks.

India’s Nuclear Energy Landscape

India’s nuclear energy capacity remains modest but strategically important. Currently, nuclear power contributes to about 3% of the country's electricity generation, with an installed capacity of 8.8 GW across 24 operational plants. According to the Nuclear Energy Mission for Viksit Bharat, nuclear capacity is projected to rise to 22,480 MW by 2031–32, and further to 100 GW by 2047.

The Union Budget 2025–26 reaffirmed the government's commitment, allocating ?20,000 crore for a comprehensive Nuclear Energy Mission. A key focus of this mission is the development of Small Modular Reactors (SMRs) and Bharat Small Reactors (BSRs), which promise safer, decentralized, and more flexible energy deployment across the country.

Existing Legal Framework

1. Civil Liability for Nuclear Damage Act (CLNDA), 2010

Enacted in the wake of global industrial disasters such as the Bhopal gas tragedy (1984), the Fukushima nuclear disaster (2011), and the Gulf of Mexico oil spill, the CLNDA is a landmark law designed to protect the rights of victims in the event of a nuclear accident.

Key provisions of the CLNDA include:

• Primary liability rests with the nuclear operator, typically the Nuclear Power Corporation of India Ltd. (NPCIL).

• Operator liability is capped at ?1,500 crore.

• A unique feature is the “right of recourse” clause, which allows the operator to recover damages from equipment suppliers in case of defective equipment or negligence—a provision not commonly found in international nuclear liability regimes.

2. Atomic Energy Act (AEA), 1962

The AEA centralizes nuclear control under the Union Government and prohibits private entities from independently building or operating nuclear reactors. It also authorizes the Atomic Energy Regulatory Board (AERB) to enforce safety protocols and radiation protection standards.

Amendments to this law in 2015 permitted joint ventures between public sector undertakings (PSUs), but stopped short of allowing direct private sector involvement, thereby limiting innovation and expansion.

The Core of the Debate

1. Safety vs. Investment

Critics argue that any attempt to dilute supplier liability may compromise public safety. The memory of Bhopal looms large, and there is widespread concern that removing accountability for suppliers could reduce the incentive to ensure the highest safety standards. On the other hand, proponents assert that excessive liability discourages foreign suppliers and private investment, slowing India's nuclear growth.

2. Strategic Autonomy and Technology Transfer

India's push for Small Modular Reactors (SMRs)—which rely on advanced designs and proprietary technologies—has raised strategic concerns. Foreign technology suppliers may be unwilling to transfer sensitive designs if legal liabilities remain unclear or excessive. Moreover, questions about national security and the protection of critical infrastructure persist when private or foreign entities are involved.

3. International Norms and Legal Conflicts

India’s CLNDA stands apart from most global nuclear liability laws due to its supplier liability clause. However, after ratifying the Convention on Supplementary Compensation for Nuclear Damage (CSC) in 2016, India faces pressure to align with its norms, which place sole liability on the operator. This conflict has delayed several international collaborations, including the Jaitapur Nuclear Power Project, slated to be the world’s largest nuclear plant, which has seen over a decade of delays due largely to unresolved liability disputes.

4. Private Sector Exclusion and Capacity Constraints

India’s closed nuclear model, which restricts private sector involvement, has proven to be a bottleneck in expanding capacity. While the 2015 amendments to the AEA allowed joint ventures with PSUs, direct private investment and operation remain prohibited, limiting the country’s ability to absorb new technologies, attract capital, and build capacity at the required scale and pace.

Proposed Amendments

Recognizing these challenges, the government has constituted expert committees to review and propose amendments to both the CLNDA (2010) and AEA (1962). The goal is to:

• Enable private sector participation in nuclear infrastructure development.

• Align domestic laws with international liability frameworks like the CSC.

• Create a more investment-friendly environment without undermining safety or public accountability.

These amendments, if passed, could allow private firms to construct and possibly operate reactors, while limiting their legal exposure by channeling liability through government operators, in line with global norms.

Conclusion

The ongoing debate over nuclear liability and energy reform is emblematic of India’s broader dilemma how to balance safety, sovereignty, and growth. On one hand, strong liability provisions protect public interests, especially in a country with a painful history of industrial disasters. On the other, investment, innovation, and technology transfer are indispensable for scaling up clean energy production and achieving the country’s energy and climate goals.