The announcement was made by Finance Minister Nirmala Sitharaman while presenting the Union Budget for 2025-26 in Parliament. The move is expected to boost India-US cooperation in civil nuclear energy, especially after Washington recently lifted restrictions on three Indian nuclear entities.
NEW DELHI: India has announced plans to amend its nuclear liability law and set up a ‘Nuclear Energy Mission’ with an investment of Rs 20,000 crore. This major decision comes just before Prime Minister Narendra Modi’s expected visit to the United States.
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The announcement was made by Finance Minister Nirmala Sitharaman while presenting the Union Budget for 2025-26 in Parliament. The move is expected to boost India-US cooperation in civil nuclear energy, especially after Washington recently lifted restrictions on three Indian nuclear entities.
Why is India Changing the Nuclear Liability Law?
India’s Civil Liability for Nuclear Damage Act, 2010 has been a major obstacle in implementing the Indo-US civil nuclear agreement. The agreement, originally finalized 16 years ago, was meant to allow US companies to supply nuclear technology to India. However, strict liability clauses in Indian law discouraged US nuclear firms like General Electric and Westinghouse from investing in India.
To overcome these hurdles, India has now decided to amend the law along with changes to the Atomic Energy Act of 1962, which currently prohibits private sector investment in nuclear power plants.
India’s Plans for Nuclear Energy Growth
The Indian government has set a goal of generating at least 100 gigawatts (GW) of nuclear energy by 2047.
While presenting the budget, Finance Minister Nirmala Sitharaman said:
“Development of at least 100 GW (Gigawatt) of nuclear energy by 2047 is essential for our energy transition efforts.”
She further added: “For an active partnership with the private sector towards this goal, amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act will be taken up.”
A key part of this initiative is the establishment of a ‘Nuclear Energy Mission’ focused on research and development of Small Modular Reactors (SMRs).
“At least five indigenously developed SMRs will be operationalised by 2033,” Sitharaman stated.
Prime Minister Narendra Modi welcomed the decision, calling it a major step for India’s future in nuclear energy.
“This will ensure a major contribution of civil nuclear energy in the development of the country in the coming times,” PM Modi said.
He further emphasized:”Civil nuclear energy will ensure a significant contribution to the country’s development in the future.”
Last month, the US removed restrictions on three Indian nuclear entities: Bhabha Atomic Research Centre (BARC), Indira Gandhi Atomic Research Centre (IGCAR), and Indian Rare Earths (IRE). This decision followed an announcement by then US National Security Advisor Jake Sullivan, who said that Washington was finalizing steps to “remove” hurdles for civil nuclear partnership between Indian and American companies.
The US and India have been working on nuclear cooperation since 2005, when then Prime Minister Manmohan Singh and US President George W. Bush laid the foundation for the landmark civil nuclear agreement. However, due to India’s liability laws, progress in this sector had been slow.
In recent years, India has been exploring nuclear partnerships with several countries, including the US and France. Small Modular Reactors (SMRs) are a key area of interest, and India may seek collaboration with the US government and private firms.
Holtec International, a US-based company known for its expertise in SMRs, is among the potential partners. Reports suggest that India’s Department of Atomic Energy is keen on working with Holtec to boost SMR development in the country.
India’s move to amend nuclear laws and promote private sector participation is expected to open new opportunities in civil nuclear energy. The upcoming visit of PM Modi to the US is likely to further strengthen nuclear cooperation between the two countries.
