SHANTI Bill and Nuclear Liability Debate

Context

1. The Lok Sabha passed the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025.
2. The legislation triggered strong opposition, particularly over the removal of supplier liability under the existing nuclear liability framework.
3. The Bill will now be taken up in the Rajya Sabha.

What is the SHANTI Bill, 2025?

1. The SHANTI Bill aims to reform India’s nuclear energy sector to:
   1. Increase nuclear power capacity
   2. Attract private and foreign investment
   3. Support India’s clean energy and net-zero goals
2. A key feature of the Bill is the modification of the Civil Liability for Nuclear Damage Act, 2010.

Major Change Introduced in New Bill

1. The Bill removes the provision that allowed nuclear plant operators to seek compensation (right of recourse) from equipment suppliers if an accident occurred due to defective equipment.

India’s Current Nuclear Liability Framework

1. The Civil Liability for Nuclear Damage Act, 2010 (CLNDA) was enacted after the Bhopal Gas Tragedy, reflecting strong public concern about corporate accountability.
2. The Act uniquely allowed:
   1. The operator (usually NPCIL) to claim recourse from suppliers.
3. This clause was not common internationally, where liability generally rests only with the operator.
4. Impact of the Clause:
   1. Foreign companies were reluctant to invest due to:
      1. Fear of unlimited liability
      2. High insurance risks
   2. This limited the benefits of the India–US Civil Nuclear Agreement (2008) despite India receiving a waiver from the Nuclear Suppliers Group (NSG).

Why Has the SHANTI Bill Become Controversial?

1. Removal of Supplier Liability
   1. Opposition argued that removing supplier responsibility:
      1. Weakens public safety safeguards
      2. Shifts the burden of accidents onto the Indian State and public
   2. Congress MP Manish Tewari highlighted that the BJP had earlier opposed the absence of such a clause in 2008.
2. Allegations of Corporate Favouritism
   1. Questions were raised over:
      1. The timing of the Bill
      2. Reported interest by large conglomerates, particularly Adani, in the nuclear sector
   2. The government rejected these allegations, calling them baseless and damaging to parliamentary dignity.
3. Cap on Operator Liability
   1. The Bill reportedly caps operator liability at ₹3,000 crore.
   2. Opposition MPs questioned:
      1. The scientific and financial basis of this figure
      2. Whether it is adequate to compensate victims in case of a major nuclear accident.

Government’s Justification for the Bill

1. Changing Technology and Risk Profile
   1. According to the government:
      1. Technology has evolved since 2010
      2. India is moving towards Small Modular Reactors (SMRs)
   2. SMRs:
      1. Are smaller in size
      2. Have enhanced safety features

• Can be installed closer to urban areas

2. Lower Risk of Catastrophic Accidents
   1. The government argues that:
      1. Modern reactors significantly reduce accident risks
      2. The older liability framework no longer reflects technological realities
   2. Need for Investment and Energy Transition
      1. India needs massive investment to:
         1. Expand clean energy
         2. Reduce dependence on fossil fuels
      2. Private participation is seen as essential due to:
         1. Fiscal constraints
         2. Rising energy demand

Political and Economic Dimensions

1. Opposition parties linked the Bill to:
   1. Falling foreign investment
   2. Currency depreciation
   3. Global trade pressures
2. They accused the government of compromising public interest to attract foreign capital.
3. The government maintained that the Bill is policy-driven, not company-specific.

Implications

1. Boost to nuclear investment: May attract domestic and foreign private players.
2. Faster nuclear expansion: Supports India’s clean energy and climate commitments.
3. Reduced supplier risk: Aligns India with international nuclear liability norms.
4. Public safety concerns: Raises questions about victim compensation and accountability.
5. Federal and parliamentary scrutiny: Highlights the need for wider consultation on sensitive sectors.

Challenges & Way Forward

Conclusion

The SHANTI Bill represents a major shift in India’s nuclear governance framework. While it aims to unlock investment and modernise nuclear energy, the removal of supplier liability has raised serious concerns about safety, accountability and public interest. For long-term success, nuclear expansion must be accompanied by robust regulation, transparent oversight and credible compensation mechanisms, ensuring that energy security does not come at the cost of public trust.