In Budget 2025, Finance Minister Nirmala Sitharaman proposed amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act to support the development of small modular reactors (SMRs), with an allocation of ₹20,000 crore for research and development.
This initiative aims to operationalize at least five indigenously developed reactors by 2033, contributing to the government’s target of 100 GW of nuclear energy capacity by 2047. The proposed policy and regulatory changes could help attract private investment in cost-effective, secure SMRs for captive use, offering scalable solutions for high-carbon industries. “Streamlining laws and regulations through these amendments may boost private sector confidence, support decarbonisation efforts, and accelerate India’s transition to a low-carbon energy future,” said Mukund Puranik, Senior Partner, Singhania & Co.
Outlay of 1.5 lakh crores for 50 year interest free loans to States for capital expenditure is positive for infrastructure sector, will incentivise States to accelerate spending on infrastructure sector.
Announcement to set up 5 small modular reactors (SMRs) is long overdue and will greatly contribute to 500 GW non-fossil fuel installed capacity target by 2030 and give a push to India’s decarbonisation agenda. That said, matching financial outlay to fund such reactors is missing in the budget announcement.
A promised amendment to the Atomic Energy Act should pave the way for PPPs in the nuclear power business. “But an amendment to the Civil Liability for Nuclear Accidents Act to make the liability regime consistent with international conventions will be a prerequisite for attracting significant private sector interest in the nuclear sector,” said Ramanuj Kumar, Partner (Co-Head – Projects (Energy & Energy Transition)), Cyril Amarchand Mangaldas.
The government’s commitment to transition to Nuclear Energy and inclusion of The Private sector in its development; with the vision of sourcing atleast 100 GW of energy from Nuclear Power Plants. “While the NPCIL’s Request for Proposals released this January was already moving this initiative ahead – a commitment to necessary amendments to the Atomic Energy act and Civil Liability for Nuclear Damage Act further solidifies the confidence in this initiative,” said Shri Venkatesh, Managing Partner, SKV Law Offices.
