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SHANTI Act, 2025 and Nuclear Liability Concerns

Kumari Sonali

SHANTI Act, 2025 and Nuclear Liability Concerns:

The Supreme Court of India has initiated a review to determine whether the statutory liability caps prescribed under the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025, can legally restrict constitutional courts from awarding fair and suitable compensation to victims of a nuclear disaster.

  • The Court has also sought clarification on whether Section 17(4), which governs appointments to the Atomic Energy Regulatory Board (AERB), creates a potential conflict of interest.
  • A three-judge Bench headed by the Chief Justice of India issued notices to the Union government and the AERB, responding to petitions arguing that these statutory caps leave victims inadequately compensated.
  • The SHANTI Act, 2025 replaced the Civil Liability for Nuclear Damage (CLND) Act, 2010, aiming to facilitate private-sector participation in India’s civil nuclear sector by easing stringent liability norms and establishing a predictable civil liability framework.
  • Under the Act, a “company” has the meaning assigned under Section 2(20) of the Companies Act, 2013, but excludes companies incorporated outside India.
  • It gives the AERB statutory status to strengthen regulatory authority and nuclear safety oversight.
  • SHANTI Act, 2025 reserves sensitive activities such as uranium enrichment, spent-fuel reprocessing, high-level waste management and heavy-water production for the Central Government or its wholly owned institutions.
  • Dispute Redressal: Establishes an Atomic Energy Redressal Advisory Council, with the Appellate Tribunal for Electricity serving as the appellate authority.
  • Nuclear Liability under Previous Framework (CLND Act, 2010): Established a “no-fault regime” where victims only had to prove damage, not negligence.
  • Capped operator liability for large reactors at Rs 1,500 crores, while 300 million Special Drawing Rights (SDR) was the overall maximum liability for a nuclear incident.
  • It granted operators a statutory “right of recourse” against suppliers if an accident was caused by defective equipment, patent or latent defects, keeping manufacturers legally accountable.
  • Nuclear Liability under SHANTI Act: Instead of a uniform cap, financial liability for the operator is tiered based on the thermal capacity and risk profile of the nuclear installation: