Syllabus: Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
Context and Background
- Nuclear power contributed only around 3% of India’s electricity generation in 2024–25.
- Government has set a target of 100 GW nuclear capacity by 2047.
- Target includes deployment of at least five indigenous Small Modular Reactors by 2033.
Purpose and Scope of SHANTI Bill
- SHANTI Bill proposes changes in legal authority to build and operate civil nuclear facilities.
- It allows the Centre to license nuclear activities beyond traditional government operators.
- Licences may be issued to government entities, joint ventures, and other companies, subject to conditions.
- The intended new operators are primarily domestic private capital, not foreign plant owners.
Rationale for Private Participation
- Achieving the 100 GW target requires substantial mobilisation of financial capital.
- Allowing licensed non-government entities helps share construction and investment risks.
- The Bill retains state control over sensitive fuel cycles to prevent proliferation risks.
- Private participation is permitted mainly in plant delivery and supply chain segments.
Regulatory and Economic Implications
- SHANTI consolidates safety, enforcement, dispute resolution, and participation terms in one statute.
- This clarity may reduce legal ambiguity faced by new entrants.
- It could lower transaction costs and shorten site approval and commissioning timelines.
Liability Provisions and Concerns
- Maximum operator liability for a nuclear incident is capped at ₹3,000 crore.
- The Centre bears liability beyond the cap and may assume full liability in public interest.
- These provisions ease investment risk but raise concerns on victim compensation adequacy.
Insurance, Supplier Liability, and Accountability
- Operators must maintain insurance or financial security, but Central installations are exempted.
- Operator recourse against suppliers exists only through explicit contracts or proven intent to harm.
- Supplier accountability may therefore vary across projects, depending on contractual terms.
Regulatory Independence and Governance Issues
- SHANTI establishes a statutory framework for nuclear governance.
- However, appointment powers remain with the Centre and Atomic Energy Commission.
- Limited regulatory independence may undermine public trust and discourage investor confidence.