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Government to Allow Private and Foreign Participation in Nuclear Power, Caps Vendor Liability

The Indian government is set to introduce two significant amendments in Parliament during the upcoming monsoon session aimed at opening up the civil nuclear energy sector. The first amendment will ease the Civil Liability for Nuclear Damage Act, 2010, by capping the liability of equipment vendors in the event of a nuclear accident. This cap will limit monetary exposure to the original contract value and may include a time limit on liability, addressing a major concern that has deterred foreign nuclear suppliers like GE-Hitachi, Westinghouse, and Framatome from investing in India.

The second amendment proposes allowing private companies, including potentially foreign firms with minority equity stakes, to operate nuclear power plants — a sector currently monopolized by state-owned entities such as NPCIL and NTPC. This reform marks a historic shift towards greater commercialization and foreign participation in India’s nuclear power generation, leveraging the long-standing Indo-US civil nuclear deal to attract investment and technological expertise.

These legislative changes are part of the government’s broader strategy to accelerate nuclear energy capacity expansion, facilitate trade relations with the US, and overcome longstanding legal bottlenecks that have limited growth in this strategic sector. Passing these amendments will be critical to unlocking private and foreign investment and enhancing India’s clean energy portfolio.