As India’s economy becomes more digital and electricity demand becomes round-the-clock, policymakers are seeking clean power sources that deliver reliability, not just capacity. This is also shaping how India thinks about the next phase of power infrastructure buildout, because a power system dominated by solar and wind needs dependable firm supply to balance intermittency and maintain grid stability.

The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act seeks to enable nuclear energy to play a central role in meeting new demands from data centers, AI, quantum computing, and other high-load facilities that require an uninterrupted, stable power supply.

The President has given her assent to the Act, which was passed by the two Houses of Parliament.

While India has set ambitious renewable energy targets of 500 GW by 2030 and 1,800 GW by 2047, policymakers are also considering nuclear power amid concerns about the intermittency of solar and wind energy.

This push for dependable clean power is one of the key reasons the Act was introduced. India is trying to build an energy system that can decarbonize its economy while also meeting the needs of industries that cannot afford power interruptions, such as data centers, semiconductor manufacturing, and hard-to-abate industries.

Solar and wind add large volumes of low-cost energy, but their output is variable, and their contribution to meeting peak demand depends on time of day, season, and local grid constraints. As renewable penetration rises, the system increasingly needs resources that can hold frequency, provide voltage support, manage ramping, and cover evening peaks when solar generation drops. Historically, coal has played that role in India, but it is also the most emissions- and pollution-intensive option.

Though battery energy storage systems are taking center stage due to improved economics, most grid batteries today are short-duration, making them suitable for fast balancing, peak shaving, and shifting solar into the evening, but a poor fit for long-duration storage. Batteries also degrade over time from both cycling and calendar aging, sometimes requiring mid-life augmentation or earlier replacement.

Nuclear energy is uniquely placed to provide round-the-clock, low-carbon electricity, complementing variable renewable energy sources such as solar and wind. Beyond electricity generation, nuclear energy is also seen as vital for hard-to-abate industrial sectors and future applications, including hydrogen production, desalination, and industrial process heat.

Nuclear plants can have high capacity utilization, often reaching around 90%, making them structurally different from intermittent renewables whose output depends on weather and time of day. In system terms, that means nuclear can provide “baseload” or “always-available” clean electricity and a stabilizing anchor for the grid, potentially reducing reliance on coal for continuous supply and grid services.

But the trade-offs are material and shape the extent to which nuclear can realistically influence renewable buildout. Nuclear projects typically have long gestation periods, and high upfront capex and financing costs over multi-year construction timelines dominate their economics. Safety, emergency preparedness, waste handling, and public acceptance are not side issues; they determine permitting speed, investor risk, and, ultimately, whether projects get built on schedule. If nuclear buildout slips, the system’s near-term need for firm power can revert to coal or gas, even if renewable capacity additions remain strong.

This multi-year construction timeline constraint is central to why data-center-driven nuclear enthusiasm in the West hasn’t instantly translated into installed capacity and why India’s nuclear push will also be judged on execution speed.

The World Nuclear Association notes that nuclear plants typically take over five years to construct, and total end-to-end lead times can be longer once licensing, financing, supply-chain readiness and commissioning are included. Most real-life cases suggest the journey from initial consideration to a first plant entering operation is often 10–15 years.

India’s own policy debate reflects these realities since the government-appointed panel has pointed to average timelines of roughly 11–12 years from site approval to commissioning, recommending reforms to compress the cycle.

India plans to scale its nuclear power capacity to around 100 GW by 2047, a more than tenfold increase from its current installed capacity of 8.88 GW. The country has 25 nuclear reactors, largely based on indigenously developed pressurized heavy water reactor (PHWR) technology.

The roadmap estimates that achieving the 2047 target would require adding about 4.1 GW of nuclear capacity each year over the next two decades, an unprecedented scale-up for the sector.

PHWRs are expected to remain the backbone of India’s nuclear fleet, contributing over 46 GW by 2047. Light-water reactors, including those built to imported designs, are projected to account for nearly 39 GW.

Fast breeder reactors form a smaller but strategically important component, aligned with India’s long-term three-stage nuclear program. In contrast, small reactors and small modular reactors are proposed mainly for captive and industrial applications. The indicative capacity mix totals just over 100 GW by 2047.

The Act can be seen as a step forward in the domestic policy sequence accelerated by global tailwinds rather than triggered purely by them. In the Budget 2025, the government proposed establishing a new Nuclear Energy Mission, focusing on research and development of small modular reactors, with an allocation of ₹200 billion (~$2.30 billion). This mission aims to operationalize at least five indigenously developed small modular reactors by 2033.

At the same time, the international nuclear-for-AI narrative has clearly strengthened the political case.  In the U.S., President Trump issued executive orders explicitly aimed at fast-tracking nuclear licensing in response to electricity demand growth from AI and data centers. In Europe, utilities like EDF have factored in data-center demand growth into forward planning for new reactors.

India arguably starts from a stronger industrial base than many nuclear newcomers because it already designs, builds, and operates a largely indigenous PHWR fleet and is now trying to downscale that ecosystem into smaller units for captive and industrial use.

The government has already positioned Bharat small reactors a 220 MW PHWR-based units intended for captive deployment in hard-to-abate industries as an early pathway that leverages proven domestic technology and supply chains rather than betting everything on unproven, first-of-a-kind imported SMR designs.

Separately, government disclosures indicate Bhabha Atomic Research Centre and Nuclear Power Corporation of India have completed the concept design stage of an indigenous Bharat SMRs, with stated construction timelines discussed in the 60–72 month range, highlighting that even smaller reactors still operate on multi-year delivery cycles.

The U.S. experience is a useful reality-check for India because it shows that even with deep capital markets and strong political messaging, SMRs are not yet solved at scale. NuScale has received NRC design approvals, but its flagship Idaho SMR project with UAMPS was terminated in 2023 after cost escalations and insufficient customer subscriptions.

Meanwhile, new U.S. SMR efforts are still moving through permitting and subsidy channels. The Tennessee Valley Authority (TVA) has submitted a permit application to the U.S. Nuclear Regulatory Commission for an SMR, and the U.S. Department of Energy has announced major funding support for TVA and Holtec SMR projects that are targeting early-2030s operation.

Bill Gates-backed TerraPower is building its Natrium demonstration in Wyoming and pursuing regulatory reviews abroad illustrating both the momentum and the persistent constraints like licensing, fuel supply, and construction sequencing that still shape next-gen nuclear timelines.

If nuclear additions materialise on time, they can provide a clean, high-availability backbone that helps absorb more renewables without relying as heavily on coal for stability and to even out supply. If additions come slowly, nuclear will still matter strategically for hard-to-abate demand and high-reliability loads.

Why the Act Was Needed

India’s existing nuclear laws were written at a time when nuclear power was almost entirely a state-led activity, with limited private participation and fewer non-power applications. Since then, nuclear energy has become increasingly relevant not only for electricity generation but also for healthcare, agriculture, research, industry, data centers, and emerging technologies that require uninterrupted power.

The Act aims to align the legal framework with this expanded role of nuclear energy, while also incorporating lessons from global nuclear safety standards and international liability conventions.

The proposed legislation is divided into ten chapters covering licensing, safety authorization, regulatory oversight, civil liability, compensation, enforcement powers, and dispute resolution. It repeals both the Atomic Energy Act of 1962 and the Civil Liability for Nuclear Damage Act of 2010, while preserving existing licences, rules, and approvals until they are replaced under the new law.

Unlike earlier frameworks, the Act allows licenses to be granted not only to government entities but also to government companies, joint ventures, and private companies notified by the Central Government.

However, this openness comes with strict conditions. Certain sensitive activities remain reserved exclusively for the government, including spent fuel reprocessing, high-level radioactive waste management, heavy water production through isotopic separation, and enrichment beyond notified limits.

Private participation is permitted, but only within carefully defined boundaries.

This “24×7 clean power for digital infrastructure” framing is also gaining traction globally, especially in the U.S. and parts of Europe, where the AI/data-center power surge is pushing governments and companies back toward nuclear as a firm, low-carbon option. In the U.S., Microsoft signed a 20-year deal linked to restarting the Three Mile Island Unit 1 reactor (Crane Clean Energy Center) for data-center power. Google also signed a corporate agreement to buy power from Kairos Power’s planned SMRs while Amazon has announced investments and agreements aimed at accelerating SMR deployment.

In Europe, Westinghouse and French data-center operator Data4 have signed an memorandum of understanding to explore SMR-powered data centers, and France’s EDF has explicitly pointed to future demand growth (including from data centers) as part of the rationale for its next reactor buildout.

It is important for India to consider how nuclear fits strategically into it’s current energy economy before jumping on the bandwagon which happens too often. Hydrogen is a case in point.

Civil Liability and Ceilings

One of the most closely watched aspects of the Act is its approach to liability.

In the event of a nuclear incident, the operator of the nuclear installation is generally liable for nuclear damage arising from that incident, including damage during transport of nuclear material when the operator has custody.

The operator is not liable for losses arising from exceptional natural disasters, armed conflict, war, civil unrest, or acts of terrorism. Damage to the installation itself and certain on-site property is also excluded from compensation claims.

The Act sets a maximum overall liability per nuclear incident equivalent to 300 million special drawing rights, unless a higher amount is notified.

Operator liability is capped by the reactor’s size and category, with the highest category capped at ₹30 billion (~$332.39 million). Smaller installations have lower caps as specified in the schedule.

Once the operator’s liability limit is exhausted, the Central Government steps in to cover the remaining compensation. The government is also fully liable for incidents at government-owned installations and for incidents caused by exceptional events such as war or terrorism.

To support this framework, the government may establish a Nuclear Liability Fund.

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