The SHANTI Act 2025 now allows private companies to build and operate nuclear power plants in India. This major policy shift aims to reach 100 GW of nuclear capacity by 2047 by easing liability rules and opening the supply chain. Equipment manufacturers are now planning capacity expansions to meet the expected rise in domestic demand for specialized nuclear components.
The nuclear energy sector in India is entering a new phase following the implementation of the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025. This legislation replaces older regulations like the Atomic Energy Act of 1962, providing a more modern framework for civilian nuclear power. By allowing private participation in building, owning, and operating nuclear plants, the government aims to accelerate the transition toward its 100 GW capacity target by 2047.
Easing Liability for Suppliers
A critical change in this new law is the overhaul of the civil liability framework. Previously, suppliers of nuclear equipment faced significant uncertainty regarding their liability in the event of an incident. The SHANTI Act removes the provision that allowed recourse for gross negligence, instead shifting toward a system based on specific contractual agreements. This adjustment is intended to encourage private manufacturers to invest in the nuclear supply chain without the burden of open-ended liability risks. The government continues to maintain oversight on sensitive areas such as fuel management and heavy water production to ensure safety and national security.
Impact on Equipment Manufacturers
The industry is already responding to these regulatory changes. Companies that produce essential infrastructure for power plants, such as specialized forgings, pumps, and heat exchangers, are planning to increase their manufacturing capacity. This includes players like Walchandnagar Industries, KSB Ltd, Tema India, and Electronet Equipments. These firms are preparing for a potential influx of orders as private sector projects move from planning to execution. Beyond traditional large reactors, the Act also clears the path for the development of small modular reactors, which may create further opportunities for specialized engineering firms.
Fuel Security and Future Outlook
The expansion strategy is being supported by improved access to fuel. India has recently operationalized uranium exports from Australia under a prior agreement, which helps secure the necessary fuel supply for its ambitious growth plans. For investors, the primary monitorable will be the actual pace of project announcements and the conversion of these plans into firm order books for component manufacturers. While the policy environment has significantly improved, the long-term benefit for companies will depend on the speed of regulatory approvals for new projects, the financial viability of private-sector-led nuclear plants, and the ability of manufacturers to manage the cost of capacity expansion against future demand trends.