The Sustainable Harnessing and Advancement of Nuclear Energy to Transform India (SHANTI) Bill, 2025, which opens the entry of private players to nuclear energy, addresses concerns related to operator liability rules. However, high capital costs, execution risks and rate competitiveness remain a challenge.

The bill, if passed, aims to transition India from a tightly controlled and state-dominated nuclear sector controlled by the Nuclear Power Corporation of Indian Limited (NPCIL) to a more diversified model that allows for regulated private participation while maintaining government control over sensitive activities.

NPCIL has already received interest from private players to build Bharat Small Reactors (BSRs), but the industry is waiting for the legal amendment to take it forward.

Experts say nuclear power is uncharted territory for the private sector and there are inherent challenges related to high capital costs and tariffs.

“The SHANTI Bill paves the way for private participation in India’s nuclear power sector, which was till now managed exclusively by the public sector entity NPCIL. This reform aims to accelerate capacity expansion towards the government’s 100 GW target by 2047,” says Ankit Jain, Vice President and Co-Head of Corporate Ratings Group, ICRA Ltd.

He says the bill aims to address the private sector’s main apprehension by introducing clearer operator liability rules (limiting it to Rs 3 billion) along with removing the right of recourse to suppliers for faulty equipment, which previously deterred private participation. The bill largely aligns supplier liability with global practices.

“However, the sector faces inherent challenges that include extremely high capital cost (Rs 16-20 crore per MW), long gestation periods and issues related to plant stabilization. Private companies do not have an operational track record in this area, leading to concerns about execution risks and tariff competitiveness,” he adds.

The government says the new bill aligns with India’s climate commitments, including its goal of net zero by 2070 and an ambition to scale nuclear capacity to 100 gigawatts by 2047, up from about 8.2 GW today.

Karthik Ganesan, fellow and director of strategic partnerships, Council on Energy, Environment and Water (CEEW), says the passage of the bill will mark a milestone for India. “It will signal to capable private sector players that the country is open for business in the nuclear energy space and is committed to a future where nuclear energy provides the clean baseline energy for which we currently depend on coal,” he says.

Ganesan stresses that implementing this vision will require strategic thinking and a long-term commitment to a technology whose costs are locked in for the next 50-60 years.

India’s existing nuclear laws, the Atomic Energy Act of 1962 and the Nuclear Liability Act of 2010, have long been flagged by the industry and foreign suppliers as deterrents to investment. The liability law, in particular, placed open exposure on equipment suppliers, making global reactor manufacturers reluctant to enter the Indian market.