Department of Atomic Energy releases draft rules of SHANTI Act
The Department of Atomic Energy released draft rules under the SHANTI Act, 2025 for public and stakeholder consultation
The draft rules require nuclear operators to maintain financial security — insurance, another instrument, or a combination — covering their liability for nuclear damage
This financial security must remain in place until all spent fuel is removed from the storage pool of the concerned nuclear installation, extending the coverage period well beyond a reactor's operating life
The Ministry of Power and the Department of Atomic Energy are seeking comments before the rules are finally notified
SHANTI Act, 2025 — India's New Nuclear Legal Framework
The Sustainable Harnessing and Advancement of Nuclear Energy (SHANTI) Act, 2025 is the most significant reform of India's nuclear regulatory architecture to date. It repeals both the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010 (CLNDA), consolidating and modernising the legal framework while enabling limited private sector participation in nuclear power generation under central regulatory oversight.
Key Details
- The Act became effective on 21 December 2025, following presidential assent
- It follows through on the Nuclear Energy Mission for Viksit Bharat announced in the Union Budget 2025-26, which had proposed amending the Atomic Energy Act, 1962 and the CLNDA, 2010 to allow private participation
- Enrichment or isotopic separation of radioactive substances, management of spent fuel, and production and upgradation of heavy water remain exclusively within central government control — private participation is permitted only in areas like reactor construction and operation under license
- The draft rules now being consulted upon are the subordinate legislation operationalising the Act's liability and financial security provisions
The draft rules give practical shape to the SHANTI Act's financial security mandate for the first time since the Act came into force.
Graded Nuclear Liability Framework — SDR-Based Caps
The SHANTI Act caps the maximum liability for any single nuclear incident at the rupee equivalent of 300 million Special Drawing Rights (SDRs — the IMF's international reserve asset, valued as a basket of major currencies), with the Union Government empowered to take additional measures if actual compensation exceeds this amount. Within this ceiling, the Act's Second Schedule sets differentiated operator liability based on the installation's thermal capacity.
Key Details
- Graded operator liability ranges from Rs 100 crore for smaller reactors, certain fuel-cycle facilities, and transport activities, up to Rs 3,000 crore for reactors above 3,600 MW thermal capacity
- 300 million SDR translates to roughly Rs 3,864 crore (about $430 million at early-2026 exchange rates)
- Under the SHANTI Act, a supplier's liability to the operator is treated as a contractual right rather than an automatic statutory right (as it was under CLNDA Section 17(b)), unless the incident was caused with intent to cause nuclear damage — a notable shift from the earlier liability regime
The financial security instrument mandated by the draft rules must be sized to cover this graded liability ceiling for the specific installation.
India Nuclear Insurance Pool and the CSC Framework
Operators need a financial mechanism to actually meet their statutory liability, which India addresses through a domestic insurance pool operating within an international liability-sharing treaty framework.
Key Details
- The India Nuclear Insurance Pool (INIP) was launched in 2015 by GIC Re along with public sector general insurers, with an initial capacity of Rs 1,500 crore, to help operators secure the insurance cover required under the earlier CLNDA regime
- India ratified the Convention on Supplementary Compensation for Nuclear Damage (CSC), 1997 in 2016 — an international regime under which contracting states pool supplementary funds if operator/national liability is insufficient to cover damage from a nuclear incident
- The draft rules' requirement that financial security continue "till removal of all spent fuel from the storage pool" extends coverage beyond plant shutdown, addressing long-tail risk from stored spent fuel
Any financial security instrument approved under the new draft rules will likely be built around this existing insurance pool architecture, now recalibrated to the SHANTI Act's liability caps.
- SHANTI Act, 2025 (Sustainable Harnessing and Advancement of Nuclear Energy Act) effective from 21 December 2025
- Repeals the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010
- Maximum liability per nuclear incident: 300 million SDR (approximately Rs 3,864 crore / $430 million, early-2026 rates)
- Graded operator liability under the Second Schedule: Rs 100 crore (smaller facilities) to Rs 3,000 crore (reactors above 3,600 MW)
- India Nuclear Insurance Pool: launched 2015, initial capacity Rs 1,500 crore, managed by GIC Re
- India ratified the Convention on Supplementary Compensation for Nuclear Damage in 2016