A case against the SHANTI Act, 2025

POLITY – BILL/ACT

13 FEBRUARY 2026

(Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025

• The SHANTI Act, passed in the Winter Session of Parliament, makes major changes to India’s nuclear power framework by:

1. Opening the sector to private operators
2. Altering the liability regime
3. Restructuring regulatory oversight

Critics argue that it weakens safety and accountability safeguards.

Key Features of the SHANTI Act

1. .  Private Entry into Nuclear Power

• Ends the Union government’s exclusive control.
• Allows private entities to operate nuclear plants.

2. Changes to Liability Framework

    Supplier Indemnity

• Liability for accidents is channelled solely to the operator.
• Removes the “right of recourse” (previously under CLNDA), which allowed operators to sue suppliers for defective equipment.

     Liability Caps

• Operator liability:
  • ₹100 crore (small plants)
  • ₹3,000 crore (large plants)
• Total liability (including Centre):
  • 300 million Special Drawing Rights (~₹3,900 crore)

     Removal of Clause 46

• Victims can no longer invoke other laws (including criminal law) for additional remedies.

       Critics say this protects suppliers and operators at the cost of victims.

3.    Regulatory Structure

• Provides a legislative basis for the Atomic Energy Regulatory Board (AERB).
• However, Board members are selected by a committee constituted by the Atomic Energy Commission.
• Critics argue this limits regulatory independence.

Why Is Supplier Indemnity Controversial?

• Historically, major nuclear accidents involved design flaws:

1. Fukushima (2011) – Weak containment structure.
2. Chernobyl (1986) – Reactor design flaws and shutdown system failures.
3. Three Mile Island (1979) – Control room design issues and communication failures.
4. Critics argue that design defects have played central roles in past disasters, so shielding suppliers lacks scientific justification.
5. However, U.S. suppliers had objected to India’s earlier liability regime.
6. The 2026 U.S. National Defense Authorization Act urged India to align with international norms favouring suppliers.

Liability Cap vs Potential Damage

Accident	Estimated Damage
Fukushima	~₹46 lakh crore
Chernobyl (Belarus estimate)	~₹21 lakh crore
SHANTI Act Cap	~₹3,900 crore

• The cap is roughly 1,000 times smaller than damage from major accidents.
• Even with international supplementary compensation, victims may receive less than 1% of potential losses.

Safety Concerns

1. Moral Hazard

If operators and suppliers are shielded from full liability:

• They may take greater risks.
• Safety investments may decline.
• Natural Disaster Clause

• Operators indemnified for accidents caused by “grave natural disasters.”
• Critics say this weakens India’s earlier absolute liability principle for hazardous industries.
• Fukushima itself was triggered by a tsunami.

Nuclear Energy’s Role in India

• Contributes ~3% of electricity.
• Past targets repeatedly missed:
  • 10 GW by 2000 → achieved 2.86 GW
  • 20 GW by 2020 → achieved 6.78 GW
• New target: 100 GW by 2047.

Critics question feasibility due to:

• High capital costs
• Safety concerns
• Unproven small modular reactors

Economic Dimension

Nuclear projects involve massive commercial investments.

Example:

• Two AP1000 reactors in Georgia (U.S.) cost ~$18 billion each.

The Act:

• Creates opportunities for private and multinational firms.
• Shields them from extensive liability exposure.

Core Debate

Supporters Say	Critics Say
Aligns with international norms	Weakens victim rights
Attracts private investment	Creates moral hazard
Speeds up nuclear expansion	Undermines accountability
Provides regulatory framework	Limits regulator independence

Conclusion

• Should rapid nuclear expansion and commercial viability outweigh strict liability and victim protection in a high-risk industry?
• The answer depends on how India balances energy security, climate goals, safety and accountability and corporate risk-sharing.