Authored By: Nandini Sharma
National Law Institute University, Bhopal (NLIU)
Abstract
The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025 (SHANTI Act) is the most radical transformation of nuclear law in India since the Atomic Energy Act, 1962, with far-reaching effects of involving the private sector while fundamentally reshaping liability and regulatory control.
Dubbed as an “clean energy and energy security Act,” this law simultaneously fortifies institutional structures and weakens some of the accountability provisions inherited under the Civil Liability for Nuclear Damage Act, 2010.
In this article, I will be taking up a doctrinal and policy-focused approach to evaluate and discuss this legislation in relation to environmental protection, constitutional guarantees and democratic accountability.
Introduction
The long-term climate and development vision in India is increasingly turning to nuclear power as a key element in a low-carbon and baseload diverse energy structure. However, until 2025, the regulatory structure was centered around a state monopoly in the generation sector and a prudent liability structure, which represented a set of deep-seated fears following the Chernobyl disaster, Fukushima and Bhopal Gas Tragedy.
The SHANTI Act 2025 supersedes both the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010 and introduces an integrated liberalized policy regime that focuses on encouraging private investment, indigenization and small modular reactors (SMRs). This legislation was finalized in December 2025 and has since received the imprimatur of the presidency, with the Union government signaling an expected growth curve of 100 GW capacity in nuclear power for 2047.
This article will contend that, far from being a technicized energy law, SHANTI represents a constitutional moment in nuclear regulation, as it seeks to reconstitute the state, market and citizenry in high-risk, low probability of harm trajectories.
The overall argument is that, while the Act promotes energy security and industrial policy, it does so through measures that erode supplier responsibility, shrink citizen participation and consolidate state discretion, thus raising serious constitutional issues under Articles 14, 21 and 48A of the Indian Constitution.
Research Methodology
The work relies largely on a method of doctrinal research, reading the SHANTI Act in the context of the repealed Atomic Energy Act, 1962 and the CLND Act, 2010, as a means of deriving it from a larger body of Indian case law relating to matters of environmental and human rights jurisprudence.
Secondary sources such as parliamentary debates, official press notes, as well as views expressed by think tanks and lawyers, are used for the purposes of ascertaining legislative intentions relating to matters of energy security and climate change.
Comparisons with other schemes such as the Convention on Supplementary Compensation for Nuclear Damage (CSC) serve as a limited comparator, not for transplant purposes, but for the purposes of ascertaining the underlying norms incorporated in SHANTI, to give a broader view overall.
Legal Framework
Pre-SHANTI Nuclear Law
For many decades, the Indian regime on nuclear energy was based on a close state monopoly through the Atom Energy Act, 1962 and the design and construction as well as the operation of the civilian nuclear facility were controlled by the Nuclear Corporation of India, NPCIL and its public sector units.
The liability for the nuclear damage was regulated through the CLND Act, 2010, which was based on strict operator liability up to a maximum amount and had the unique feature of granting the operator a right of recourse in the circumstances stipulated.
This was a result of a post-Bhopal emphasis that foreign and domestic suppliers could not and should not be completely shielded from liability, although India was trying to attract foreign nuclear suppliers following the 2008 Indian-US nuclear accord and Nuclear Suppliers Group waiver.
Notwithstanding this supplier-recourse provision that was seen as an impediment to foreign investment, foreign suppliers were unwilling to subject themselves to liability that may exceed what was likely to be envisioned by international agreements.
SHANTI’s Statutory
The SHANTI Act annuls both the 1962 and 2010 laws and brings a new and contemporary structure for the governance of nuclear matters, which permits Indian private companies as well as joint ventures for the possession, construction, operation and dismantling of the Nuclear Power Plants under centralized licensing. Foreign bodies are permitted in joint ventures for technology collaborations, while the more sensible fuel cycle operations for enrichment, reprocessing and ultimate waste management remain under exclusive state control.
Institutional wise, the Act constitutionalizes the Atomic Energy Regulatory Board (AERB) by making it, for the first time, an accountable institution to Parliament, as opposed to its status prior to the Act as an institution created through executive notification. On paper, this marks an improvement from being an entirely departmental regulator, although the extent to which this institution has functional autonomy from the Union Government remains questionable, especially considering the wide powers bestowed on the Central Government in the area of exemptions.
Judicial Interpretation & Doctrinal Context
Despite being a relatively new law, the SHANTI Act has been drafted in a way that engages well-settled precedents in Indian environmental and constitutional law. However, the Supreme Court of India has long recognized the doctrine of strict liability, coupled with the doctrine of absolute liability, in the case of M.C. Mehta v. Union of India, which may be considered the cornerstone of environmental liability cases, marking an important transformation from the negligence principle to the principle of enterprise liability, where ultra-hazardous acts necessarily entail inherent risks.
Correspondingly, the precautionary principle and polluter pays principle have also been constitutionalized through Articles 21 and 48A and courts have been insisting on reducing risks ex ante and keeping the costs thereof away from affected communities. Although the CLND Act is in no way an ideal embodiment of these principles, at least it tried to give these some concrete form in the nuclear sector. Therefore, the shift in SHANTI’s policy approach towards an internationally more conventional approach of operators’ liability needs to be understood in this doctrinal context rather than merely accepted as an expert-driven policy option.
Critical Analysis
Private Participation and Regulatory Capture
A major innovation of the SHANTI Act is its focus on the role of private sector engagement, especially for Next Gen technologies including Small Modular Reactors (SMRs) and “Bharat Small Reactors”, which is an indigenous design. The rationale is filling an enormous funding gap required for making 100 GW of nuclear capacity by 2047.
However, allowing the sector to be opened to for-profit actors, there arises a classic regulatory governance dilemma of how to structurally shield the regulatory authority itself against both capture and executive domination. The SHANTI approach attempts to resolve this dilemma by
granting AERB legal status, but it still centralizes core licensing, exempting and policymaking powers in the Central Government itself, which in turn remains the political sponsor for nuclear expansion. In a risk domain where catastrophic risk is shared geographically by dispersed publics, such asymmetry may literally lead to a “closed world” of nuclear decision-making.
Liability Reform: Aligning with CSC, Departing from Bhopal’s Shadow
Turning to liability, the Bill makes India more akin to the CSC regime through the provision of exclusive legal liability for nuclear damage to the operator, thus curtailing the right of recourse against the supplier. Liability is segmented on the basis of the plant’s size, capping the liability in terms of approximate amounts of ₹100 crores to ₹3,000 crores, which has to be insured in pools like the Indian Nuclear Insurance Pool, after which the federal government takes up the liability.
There are three key implications for this.
- Firstly, in having suppliers exempted from being prosecuted through legislation, SHANTI accommodates the historic demand of overseas suppliers and brings Indian market conditions in line with global norms.
- Secondly, it is part of the problem of reducing the remit of the legacy of accountability as established through the lessons of Bhopal, as it progressively shrinks the group of actors on whom risks can be shifted even for design and production defects that can be traced upstream.
- And at last, the actual amounts of the caps seem rather low in comparison to the amounts wrought through actual disasters like Fukushima, at an estimated hundreds of billions of dollars and the population density of numerous Indian locations along coastlines and riverbanks.
Thus, what SHANTI formalizes is a system where private operators and suppliers get a large potential gain on a normal basis, but where the state and ultimately the taxpayers bear the tail risk of loss. This is a critical issue regarding distributive justice and whether this can ever be reconciled with a Court’s definition of absolute liability of dangerous activities as vouchsafed.
Transparency and RTI
Another contentious feature is that SHANTI explicitly carves out the ambit of certain nuclear related information from the Right to Information Act, 2005, by declaring to override the RTI Act in case of a conflict.
The justification being on grounds of national security, protection of sensitive design and safety information and the need to avoid panic or misuse of data.
While there is admittedly a legitimate security interest in some nuclear details, a broad statutory override risks gutting the carefully calibrated exemptions already built into the RTI Act. It also undermines community‑level trust in sitting and safety decisions, particularly for marginalized populations that bear disproportionate risk yet have the least access to expert knowledge. When read with the absence of mandatory public hearings or detailed environmental impact assessment requirements in the main text of SHANTI, the RTI carve‑out contributes to an overall picture of executive‑centric governance with reduced democratic oversight.
Environmental Protection and Inter-Generational Equity
The definition of “nuclear damage” under the Act is relatively broad, catching environmental damage, but the robustness of such recognition is undermined by the liability framework as well as by regulatory exemptions. Powers of exemption given to facilities presenting “insignificant risk” and the absence of any clear statutory decommissioning and long‑term waste‑management funds are leaving crucial issues of inter‑generational equity not addressed.
Articles 48A and 51A(g) thus cast duties on the state as well as on citizens to protect and improve the environment. A statute that shifts much of the catastrophic risk to the public while retaining both information and decision‑making tightly held invites scrutiny under Article 21’s expanded right to life and a healthy environment.
The long‑term risks, ranging from contamination of groundwater to livelihood disruption, posed to communities in areas where most prospective sites are located in coastal and agrarian belts are too complex to be settled by the primarily financial liability calculus of SHANTI.
Procedural Haste and Legislative Process
Finally, the tempo at which the SHANTI Bill passed through Parliament, being introduced and enacted within a short time, without being scrutinized by a standing committee, has been noted to be less than best practice for the kind of laws that relate to the kind of risks inherent in sophisticated technologies.
As much as the Indian Constitution does not require strict legislative scrutiny in the form of pre legislative consultation for each bill that comes before the Parliament, the lack of the same weakens the enforceability of a law that can change an industry for the long term.
In view of a nation that consistently proclaims the tenets of “cooperative federalism,” the minimal participation of the states and other local entities within the SHANTI framework with regard to nuclear location and emergency preparedness is especially worrisome in terms of centralized decision-making.
Recent Developments
Since the passage, the Federal Government in the Union has formulated SHANTI as a key plank in their vision for the year 2047, relating it to their commitment to net-zero targets and propelling India as a future exporter of SMRs and other kinds of nuclear technology. Reportedly, expressions of interest have been invited from the private sector for pilot projects for SMRs and talks with foreign suppliers seem to have been accelerated because of the new structure for liability.
Conversely, matters related to safety, evacuation and socio-economic impacts have also been raised by environment NGOs, civil liberties groups and some energy experts on the large-scale nuclear program in India. News reports and expert analyses have pointed to concerns that the possibility of an “executive-heavy” approach and restricted access to RTI, may undermine public consent and India’s reputation as a jurisdiction wedded to environment and human rights approaches to development.
Moving Forward
Firstly, the independence of the regulation system needs to be enhanced beyond the legislative relationship to ensure that the finances of AERB are ring-fenced and there is a clear distance between the promotional activities of the Department of Atomic Energy and the regulatory functions of AERB.
Including the conduct of public consultations in the regulation processes and ensuring that the key decisions taken by AERB are amenable to judicial review would help to build trust in the regulation process itself.
Second, the framework of liability can be reconsidered for taking account of indexation of the cap, mandatory funding for decommissioning and managing waste and at least limited fault liability against suppliers on proven design or production flaws.
It can bring the SHANTI system more in line with India’s own precedents on polluter pays and enterprise liability but help provide enough clarity for attracting investments.
Thirdly, the transparency rules should be rebalanced so that RTI becomes the default position, with carefully crafted carve-outs for specific security matters which should be assessed for proportionality.
This could also be achieved through legislation or regulations requiring regular public reporting on safety audits, near-miss reports and emergency preparedness exercises, particularly within vulnerable sectors.
Finally, the parliaments and state legislature must introduce more specific norms regarding pre legislative consultation and scrutiny by committees, especially within legislation that affects high-technology sectors that have long-term externalities.
This will not only enhance the quality of nuclear legislation, but it will also indicate that the democratic culture of deliberation is important in light of the fact that the rights of people are being shaped by technocratic decisions in contemporary society.
Conclusion
The SHANTI Act 2025 ushered in a major shift in the Indian nuclear program, commending an accelerated build-out, modernization and harmonization regarding international conventions on liability. However, in the discourse on sustainability and change, tough questions on risk, profit and voice for people impacted by an energy future secured by nuclearization remain.
If adopted in the current form and with no change towards further reform, the SHANTI Bill has the potential to embed a system where the interests of the private and strategic sectors take precedence over safety and the principles of transparency and victim-justice in conflict with the constitutional commitments to the rights to life, environment and equality.
A balancing plan of securing the independence of the regulatory regime with the re establishment of comprehensive transparency and the re-establishment of the polluter-pays scheme can assist in ensuring that the pursuit of clean energy in India does not compromise the democratic and environmental foundations.
Bibliography
Primary legislation and Constitution
The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act 2025 (SHANTI Act).
Atomic Energy Act 1962.
Civil Liability for Nuclear Damage Act 2010 (CLND Act).
The Constitution of India 1950, arts 14, 21, 48A, 51A(g).
Right to Information Act 2005.
International instruments
Convention on Supplementary Compensation for Nuclear Damage (adopted 12 September 1997, entered into force 15 April 2015).
Cases
M C Mehta v Union of India (Oleum Gas Leak case) 1987 SCR 819 (SC). Online reports, blogs, and commentary on SHANTI
Argus Partners, ‘SHANTI Act – A Structural Reset of India’s Nuclear Energy Framework’ (Argus Partners, 18 December 2025) https://www.argus
p.com/updates/updates/shanti-act-a-structural-reset-of-indias-nuclear-energy-framework/ accessed 22 December 2025.
PRS Legislative Research, ‘The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Bill, 2025’ (PRS, 22 December 2025)
https://prsindia.org/billtrack/the-sustainable-harnessing-and-advancementof-nuclear energy-for-transforming-india-bill-2025 accessed 22 December 2025.
Press Information Bureau, ‘Cabinet Approves SHANTI Act, 2025’ (PIB, 20 December 2025)
https://www.pib.gov.in/PressNoteDetails.aspx?id=156593&NoteId=156593&ModuleId= 3 accessed 22 December 2025.
‘Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025’ InsightsIAS (23 December 2025)
https://www.insightsonindia.com/2025/12/22/sustainable-harnessing-and-advancement of-nuclear-energy-for-transforming-india-shanti-act-2025/ accessed 24 December 2025.
‘SHANTI Bill 2025’ Drishti IAS (16 December 2025) https://www.drishtiias.com/daily updates/daily-news-analysis/shanti-bill-2025 accessed 24 December 2025.
Tanvi Madan, ‘The SHANTI Bill: India’s Nuclear Reforms and the Execution Challenge Ahead’ Observer Research Foundation (24 December 2025)
https://www.orfonline.org/expert-speak/the-shanti-bill-india-s-nuclear-reforms-and-the execution-challenge-ahead accessed 24 December 2025.
‘SHANTI Act 2025: Sidelining Environment for Private Proliferation’ LiveLaw (21 December 2025) https://www.livelaw.in/articles/shanti-nuclear-energy-bill-2025-and private-nuclear-expansion-analysis-514188 accessed 24 December 2025.
