In December 2025, after years of consideration, India passed a law allowing private companies, including foreign firms, to invest in nuclear power plants. Known as the SHANTI (“Sustainable Harnessing and Advancement of Nuclear Energy in India”) Bill, the legislation opens a significant opportunity for international energy investors in a priority sector for the Narendra Modi administration.
India is facing an air pollution crisis driven largely by its reliance on coal-fired power plants, which supply as much as 75 percent of the nation’s electricity. In 2019, smog blanketing cities such as Delhi was blamed for an estimated 1.67 million deaths and economic losses of $36.8 billion, or about 1.36 percent of GDP. In 2021, Prime Minister Narendra Modi pledged to take India’s emissions intensity 45 percent below 2005 levels by 2030 (excluding land use, land-use change, and forestry) and to raise the share of non-fossil power capacity to 50 percent by the same year. With the world’s largest population and an annual GDP growth exceeding 7 percent, electricity demand is surging. Since 2021, consumption has grown at an annual rate of 9 percent, significantly higher than the 5 percent average recorded over the previous decade. The government’s push to expand data center capacity may drive demand even higher. To address air pollution, fulfill international commitments, and sustain economic growth, India will need to find alternative sources of power in the near term.
India is one of only five Asian countries with an operable nuclear power reactor. While other Asian countries such as Indonesia and Singapore are still assessing how to incorporate nuclear energy into their power supply, India has a mature sector with 24 operable reactors and another six under construction. However, nuclear power contributes a mere 2 percent to India’s total electricity supply. Recognizing the unrealized potential of this energy source, the government announced in December 2023 that it had initiated steps to expand nuclear power supply from 7,480 MW to 22,480 MW by 2032. However, high construction costs and India’s Ministry of Commerce and Industry longstanding prohibition on private investment in “atomic energy” suggest that the government would struggle to meet this target without private capital.
Although the market opportunity is substantial, foreign investors seeking to develop nuclear power projects in India will face significant barriers to entry in the newly privatized sector.
The policy framework underpinning private participation may prove unstable, as opposition parties and civil society groups have strongly criticized the SHANTI Bill. During Lok Sabha debates, Congress Party MPs raised concerns about profiteering by large, politically connected firms, inadequate compensation mechanisms for victims of nuclear accidents, and vague provisions governing radioactive waste disposal. As leaders of the opposition Indian National Developmental Inclusive Alliance, Congress organized a walkout of the Lok Sabha in protest on December 17, 2025.
Other key stakeholders have voiced their opposition to private nuclear power, including trade unions, farmers’ organizations and environmental NGOs. The National Coordination Committee of Electricity Employees and Engineers and the Samyukt Kisan Morcha – a coalition of over forty Indian farmers’ unions – argued that the SHANTI Bill dismantles India’s long-standing nuclear safety and accountability framework. They contend that it replaces public control under the Atomic Energy Act with a profit-driven licensing regime that shifts risk onto “the people and the nation.” Alongside civil society warnings about weakened liability provisions and national security risks, unions and farmers have argued that the Bill effectively insulates corporate operators from responsibility in the event of an accident.
The combined political influence of Congress and civil society groups, particularly farmers’ organizations, could lead to a reversal of nuclear privatization before foreign investors realize meaningful returns. While Modi retains firm control over the government and has sidestepped any discussion of succession, Congress overperformed in the 2024 general election and has made gains in local governments across the country by focusing on affordability and employment. Farmers wield significant political leverage, most notably by successfully opposing the Modi government’s agriculture reform policy in 2020 and 2021 through massive nationwide protests. If Congress continues to gain electoral ground while farmers’ groups and other civil society actors mobilize against nuclear plant construction, the SHANTI Bill could be repealed after the next general election in 2029.
Even if the SHANTI Bill remains in force, foreign participation in India’s nuclear sector will require careful and sustained relationship-building with regulators and domestic industry. Private ownership – whether domestic or foreign – will be capped at 49 percent for any nuclear power project with the government retaining the remaining equity. The law also introduces a “dual-permit system” that separates strategic approval from technical safety clearance. Any entity seeking to build, own, operate, or decommission a nuclear facility must first obtain a license from the central government, which is likely to be granted only if applicants meet criteria related to national security, financial viability, and alignment with India’s broader strategic objectives. In parallel, operators must secure a separate safety authorization from the Atomic Energy Regulatory Board (AERB) for any activity involving radiation exposure. While the law strengthens AERB’s formal independence, it also means projects must satisfy two distinct decision centers – one political and strategic, the other focused on technical and regulatory matters – before moving forward.
Together, the dual-permit system and the 49 percent cap on private ownership fundamentally shape how foreign firms can enter and operate in India’s nuclear market. Investors must engage continuously with government counterparts, both as joint venture partners and as regulators controlling critical licenses and approvals. While large, experienced firms may seek to retain the full 49 percent stake permitted under the law, most investors will be better served by partnering with well-connected domestic firms that understand India’s political economy and regulatory processes. Local partners can help manage multiple veto points by coordinating with central authorities and the AERB, navigating permitting timelines, and addressing community and environmental concerns – factors that are often decisive for project execution.
In this context, the SHANTI Bill represents a meaningful opening for private and foreign investment in Indian nuclear power, but one embedded within a highly politicized and multi-layered regulatory environment. Returns will depend less on technological capability or financial strength than on an investor’s ability to manage political risk across national, state, and community levels. Persistent opposition from Congress and influential civil society groups raises the risk of policy reversal, while the dual-permit regime introduces ongoing execution and delay risks even if the law remains in force. Successful investment strategies will therefore hinge on sustained engagement with regulators, policymakers, and credible local partners to ensure projects remain commercially viable, politically defensible, and legally durable over the long term.
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Maxwell Abbott
Maxwell Abbott is a Principal at Meriwether & Co., a specialist advisory firm helping investors and corporations navigate political risk and geostrategy across Asia-Pacific. He brings over a decade of experience combining political risk analysis, strategic intelligence, and on-the-ground investigations across the region, with particular expertise in Southeast Asia.