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Opening up India’s Civil Nuclear Sector
India’s Civil Nuclear Sector Reform: Bold Amendments to Unlock Global Investment
Context: The Government of India is working on legislative amendments to two key laws — the Civil Liability for Nuclear Damage Act (CLNDA), 2010 and the Atomic Energy Act, 1962 — in order to open up India’s civil nuclear sector to greater private and foreign participation.
What is 10 CFR 810, and how has it affected the reforms?
- 10 CFR 810 is a regulation under the US Atomic Energy Act of 1954, governing the transfer of nuclear technology to foreign entities.
- Until recently, it barred US firms from manufacturing or designing nuclear equipment in India.
- On March 26, 2025, the US DoE granted specific authorisation to Holtec International and its Indian partners (e.g., L&T), clearing the way for technology transfer and joint manufacturing of Small Modular Reactors (SMRs).
- This approval catalysed India’s current reform push to amend its domestic laws accordingly.
Why are these amendments being considered now?
New 10 CFR 810 regulation: The move is partly triggered by the March 2025 clearance by the US Department of Energy under the 10 CFR 810 regulation, which now allows American companies like Holtec International to transfer unclassified Small Modular Reactor (SMR) technology to Indian entities.
- With this regulatory hurdle resolved from the US side, India is expected to reciprocate by amending its domestic laws to make the nuclear market more investable and functional.
Which laws are being amended and how?
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Civil Liability for Nuclear Damage Act (CLNDA), 2010
- What it is: A law that governs compensation for victims of nuclear accidents and assigns liability between operators and suppliers.
- Proposed Changes:
- Dilution of Section 17(b): Currently, it gives operators a broad ‘right of recourse’ against suppliers in case of equipment defects. This is seen as an impediment by foreign and domestic vendors.
- Clarification of the term “Supplier”: The definition is currently vague and may include even minor sub-vendors. Amendments will make the scope more precise and exclude low-tier suppliers.
- Capping of Liability: Likely changes include placing a monetary and temporal limit on the liability of suppliers, aligning with international standards.
- Alignment with CSC: These changes would make CLNDA consistent with the 1997 Convention on Supplementary Compensation for Nuclear Damage (CSC).
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Atomic Energy Act, 1962
- What it is: Governs the development, control, and use of atomic energy in India, including nuclear power generation.
- Proposed Changes:
- Allowing private sector entry into nuclear power operations.
- Permitting minority foreign equity participation in upcoming nuclear projects.
- Ending the current monopoly of state-owned entities such as NPCIL and NTPC in nuclear generation.
Who benefits from these changes?
Foreign vendors like Westinghouse, Framatome, and Holtec benefit from reduced liability exposure.
Where does India stand globally in terms of nuclear liability?
- India signed the CSC in 2010 and ratified it in 2016. However, Section 17(b) of the CLNDA made its liability regime more stringent than that of countries following either the Vienna Convention (1963) or Paris Convention (1960).
- The upcoming amendments will bring Indian law in line with international norms, especially by limiting recourse and clearly defining supplier liability.
- Indian private firms (e.g., L&T, Tata Consulting Engineers) can now enter nuclear generation or partner in SMR manufacturing.
- Smaller sub-vendors gain from clearer liability definitions and reduced legal risk.
- The Indian government benefits by attracting investments, enhancing energy security, and fulfilling clean energy goals.
How does the Indo-US civil nuclear deal relate to these developments?
- The Indo-US civil nuclear agreement (2008) allowed India access to nuclear technology from the US despite not being a signatory to the Nuclear Non-Proliferation Treaty (NPT).
- However, due to stringent liability laws in India, no actual project has materialised. These amendments are seen as reviving the commercial potential of that landmark deal and integrating India more effectively into the global nuclear market.
How will Small Modular Reactors (SMRs) benefit India?
- SMRs are compact, factory-built nuclear reactors with a smaller footprint and faster deployment time.
- Suitable for remote regions and decentralised power grids.
- Holtec’s SMR-160 project, if implemented in India, could reduce dependence on coal, align with climate goals, and strengthen energy security.
