Introduction

India’s nuclear energy sector is governed by a comprehensive legal framework designed to ensure safety, security, and strategic growth. With ambitious goals to expand nuclear capacity from 8.2 GW (2024) to 100 GW by 2047, recent legislative amendments aim to modernize outdated laws, attract private and foreign investment, and address long-standing challenges. This article provides a detailed analysis of India’s nuclear energy laws, their provisions, and proposed reforms.

India’s Nuclear Energy Laws: Legal Provisions

India’s Nuclear Energy Sector is regulated, for the most part, by two major legislative instruments: the Atomic Energy Act of 1962 and the Civil Liability for Nuclear Damage Act (CLNDA) of 2010. The 1962 Act provides the Central Government with overarching authority for developing, controlling, and using atomic energy for peaceful applications, thereby creating a state monopoly where only government-owned organizations such as Nuclear Power Corporation of India Ltd (NPCIL) can construct and run nuclear power plants.

The CLNDA 2010, which came into force after the Bhopal Gas Tragedy and was designed to provide quick compensation to victims of a nuclear accident, established a new “no-fault liability” regime. Although it burdens the operator (NPCIL) with primary liability, it controversially incorporates a “right of recourse” whereby the operator can recover payment from suppliers in the event of defects or poor services, a provision that has been a contentious issue and a disincentive for foreign nuclear reactor suppliers.

Facts related to India’s Nuclear Energy
Metric	Figure
Current installed nuclear capacity	8,180 MW
New capacity under development	~15,300 MW (21 reactors)
Target by 2031–32	22,480 MW
Long-term (by 2047) goal	100 GW
NTPC investment plan	$62 billion for 30 GW
Private investment target	$26 billion for 11 GW by 2040

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1. Atomic Energy Act, 1962: The Foundation

Objective

The Atomic Energy Act, 1962, establishes the legal foundation for India’s nuclear sector, prioritizing peaceful use of atomic energy and centralizing control under the government.

Key Provisions

1. Central Government Control (Sections 3, 4):

   • Grants the government exclusive rights over atomic energy resources (e.g., uranium, thorium).

   • Prohibits private entities from mining, producing, or using atomic energy without authorization.

2. Regulatory Framework:

   • Establishes the Atomic Energy Regulatory Board (AERB) to enforce safety standards, licensing, and radiation protection.

3. Powers and Penalties (Sections 17, 24):

   • Authorizes the government to implement safety protocols and penalize unauthorized activities (up to 5 years imprisonment or fines).

4. Amendments:

   • 2015 Amendment: Permits joint ventures between government entities (e.g., NPCIL and NTPC) but retains state monopoly over nuclear power generation.

Limitations

• Restricts nuclear power generation to public sector units (PSUs) like Nuclear Power Corporation of India Limited (NPCIL).

• No provisions for private or foreign participation.

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

Objective

CLNDA aligns India with international conventions (e.g., Vienna Convention) to ensure compensation for nuclear incidents while balancing operator and supplier liabilities.

Key Provisions

1. Operator Liability (Section 4):

   • No-fault liability on operators (e.g., NPCIL) capped at ₹1,500 crore.

   • Government liability extends to 300 million SDRs (~₹2,300 crore) for damages exceeding this cap.

2. Supplier Liability (Section 17(b)):

   • Allows operators to seek recourse from suppliers for defective equipment or services.

   • Deterred foreign firms (e.g., Westinghouse, GE-Hitachi) due to open-ended liability risks.

3. Compensation Mechanism:

   • Establishes Nuclear Damage Claims Commission to adjudicate claims.

   • Time-bound claims (10 years for personal injury, 20 years for property damage).

Controversies

• Section 17(b): Conflicts with global norms (e.g., Convention on Supplementary Compensation), discouraging foreign suppliers.

• Inadequate Compensation Caps: Critics argue ₹1,500 crore is insufficient for catastrophic incidents (e.g., Fukushima).

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3. Proposed Amendments

A. Atomic Energy Act, 1962

Objective: Enable private and foreign participation in nuclear power generation.
Key Changes:

• Allow public-private partnerships (PPPs) and minority equity stakes for foreign firms.

• Permit private Indian companies to operate nuclear plants under NPCIL supervision.

• Facilitate technology transfer and joint ventures for Small Modular Reactors (SMRs).

Impact:

• Break the state monopoly, attracting ₹1.13 lakh crore ($13.2 billion) in investments.

• Accelerate projects like Jaitapur (9.6 GW) and Kovvada (6.6 GW).

B. CLNDA, 2010

Objective: Align liability norms with international standards to attract foreign suppliers.
Key Changes:

• Monetary Cap: Limit supplier liability to the original contract value.

• Time-Bound Liability: Introduce a statute of limitations (e.g., 10 years post-supply).

Impact:

• Resolve disputes over Section 17(b), reviving stalled projects with U.S., French, and Russian firms.

• Enhance India’s compliance with the Indo-US Civil Nuclear Deal (2008).

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4. Strategic Drivers for Reforms

1. Energy Security Goals:

   • Target 100 GW nuclear capacity by 2047 to meet rising electricity demand and reduce coal dependency.

   • SMR Mission: ₹20,000 crore allocated to develop five indigenous SMRs by 2033.

2. Foreign Investment and Technology:

   • U.S. regulatory clearance for firms like Holtec International to transfer reactor technology.

   • Partnerships with France (EDF), Russia (Rosatom), and Canada (SNC-Lavalin).

3. Climate Commitments:

   • Nuclear energy critical for achieving net-zero emissions by 2070.

   • Avoid 32 million tonnes of CO₂ annually by replacing coal-based power.

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5. Regulatory and Institutional Framework

1. Atomic Energy Regulatory Board (AERB):

   • Mandated to enforce safety protocols, conduct inspections, and license nuclear facilities.

   • Collaborates with IAEA to adopt global best practices.

2. Department of Atomic Energy (DAE):

   • Oversees R&D, policy formulation, and international collaborations.

   • Manages institutions like Bhabha Atomic Research Centre (BARC) and Indira Gandhi Centre for Atomic Research (IGCAR).

3. Proposed Regulatory Reforms:

   • Model INSPACe (space sector regulator) to streamline licensing and oversight.

   • Create an independent nuclear regulator for transparency.

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6. Challenges and Criticisms

1. Liability Concerns:

   • Fixed operator liability (₹1,500 crore) may inadequately cover disaster costs, shifting burden to taxpayers.

2. Political Opposition:

   • States like Tamil Nadu and Maharashtra oppose nuclear projects due to safety fears (e.g., Kudankulam protests).

3. Environmental and Social Risks:

   • Displacement of communities near reactor sites.

   • Ecological impacts of uranium mining and radioactive waste.

4. Technological Gaps:

   • Slow progress in thorium-based reactors despite India’s vast thorium reserves.

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7. Comparative Analysis: India vs Global Frameworks

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8. Case Studies

1. Kudankulam Nuclear Plant (KKNPP):

   • Built with Russian collaboration, faced delays due to protests over safety and liability issues.

2. Jaitapur Project:

   • Proposed 9.6 GW plant with EDF (France) stalled due to liability disputes and land acquisition challenges.

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9. Future Outlook

1. Private Sector Entry:

   • NTPC and Reliance Industries plan to invest $62 billion in 30 GW nuclear capacity.

2. SMR Development:

   • Bharat Small Reactor (BSR): 220 MW reactors for industrial and captive use.

3. International Collaborations:

   • Indo-US Nuclear Pact: Leverage U.S. technology for advanced reactors.

   • IAEA Partnerships: Enhance safety training and waste management.

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10. Recommendations

1. Transparent Implementation:

   • Ensure community engagement and fair compensation for displaced populations.

2. Strengthen AERB:

   • Grant statutory autonomy and increase funding for safety audits.

3. Revive Thorium Program:

   • Accelerate R&D for Stage III (thorium-based) reactors under the Three-Stage Nuclear Program.

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Conclusion

India’s nuclear energy reforms mark a paradigm shift from state monopoly to a collaborative, investment-friendly model. By amending the Atomic Energy Act and CLNDA, the government aims to unlock the sector’s potential while addressing liability disputes and safety concerns. Success hinges on balancing strategic energy goals with socio-environmental accountability, ensuring nuclear power becomes a cornerstone of India’s sustainable development.