Answer

India, once a pioneer in nuclear energy in Asia, has struggled to realize its potential due to restrictive legal frameworks. Despite early nuclear ambitions, including the goal to generate 10,000 MW by 2000, India’s nuclear capacity today remains far below expectations, with China and South Korea leading the global nuclear race. 

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India’s Nuclear Power Sector Has Lagged Behind Its Potential Due to Policy Bottlenecks and Legal Constraints

• Lack of private sector participation: The Atomic Energy Act (1962) established a government monopoly, barring private sector involvement in power plant operations.
  For example: Private companies like L&T and Godrej have only supplied equipment but were never allowed to operate or manage nuclear plants.
• Restrictive liability laws: The Civil Liability for Nuclear Damage Act, 2010 (CLNDA, 2010) made plant operators liable for accidents but allowed possible course of action  against suppliers, discouraging both domestic and foreign investment.
  For example: Companies like GE and Westinghouse hesitated to enter India’s nuclear market due to liability risks under the CLNDA.
• Dependence on government funding: DAE’s reliance solely on government budgets has limited capital for scaling nuclear power capacity and delayed the adoption of advanced technologies.
  For example: India’s nuclear capacity stagnated at 8,200 MW despite earlier projections of 10,000 MW by 2000.
• Failure to align with global norms: India’s liability framework conflicts with international norms that channel all liabilities to operators, deterring global collaborations.
  For example: The UAE’s successful partnership with South Korea for nuclear reactors contrasts India’s inability to finalize foreign deals.
• Delayed modernization: Regulatory hurdles and over-reliance on legacy technologies have stalled the transition to newer and safer reactor designs.
  For example: While China deployed third-generation nuclear reactors, India still primarily uses Pressurized Heavy Water Reactors (PHWRs).

Impact of the Atomic Energy Act (1962) on the Growth of Nuclear Energy in India 

Positive Impact 

• Early foundation for nuclear research: The Act facilitated the establishment of institutions like the Bhabha Atomic Research Centre (BARC), fostering domestic R&D in nuclear science.
  For example: India built its first nuclear reactor, Apsara, in 1956, demonstrating early leadership in atomic energy research in Asia.
• Initial partnerships with global players: The Act enabled foreign collaborations, such as the Tarapur nuclear plant in 1969, built with US assistance, boosting India’s nuclear capabilities.
  For example: The Tarapur Atomic Power Station (TAPS) was Asia’s first nuclear power plant and remains operational today.
• Secured India’s strategic autonomy: By prioritizing domestic capacity building, the Act helped India maintain strategic autonomy in developing its civilian and military nuclear programs.
  For example: India developed a self-reliant reactor fleet, including PHWRs, reducing dependence on foreign technologies post-1974 nuclear sanctions.

Negative Impact 

• Centralized monopoly: The Act reserved all nuclear activities for government entities, hindering the development of a broader nuclear ecosystem and limiting innovation.
  For example: Private companies like Tata and BHEL, despite technical expertise, were restricted to equipment supply roles, excluding them from power plant operations.
• Limited funding for expansion: Government monopoly meant nuclear power expansion depended solely on public funds, which constrained capacity growth.
  For example: In comparison, South Korea, with public-private collaboration, achieved 32,000 MW of nuclear capacity, far ahead of India’s 8,200 MW.
• Inflexibility in adapting to global changes: The Act’s rigid framework prevented India from leveraging emerging international opportunities and technologies in the nuclear sector.
  For example: India could not join global supply chains for advanced reactors like China, which exports nuclear technology to countries like Pakistan.

Impact of the Civil Liability for Nuclear Damage Act (2010) on the growth of nuclear energy in India

Positive impact

• Enhanced Victim Compensation: The CLNDA ensures accountability by requiring operators to provide compensation to victims swiftly in case of nuclear accidents.
  For example: The liability provision ensures that a disaster similar to Chernobyl would not leave victims uncompensated in India.
• Focus on Safety Standards: By holding operators and suppliers accountable, the CLNDA indirectly emphasizes stringent safety protocols in plant operations and supplier quality.
  For example: Post-CLNDA, operators like NPCIL have adopted advanced safety technologies for reactors, ensuring better compliance with global safety benchmarks.
• Deterrence Against Substandard Components: The law disincentivizes suppliers from providing faulty components, ensuring robust supply chains and reliable equipment for nuclear installations.
  For example: The increased focus on supplier accountability helped improve standards for indigenous components used in the Kudankulam Nuclear Power Plant.

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Negative impact

• Hindered Foreign Investments: The right of recourse against suppliers discouraged major foreign firms like GE and Areva from investing in India’s nuclear energy projects.
  For example: Westinghouse withdrew negotiations for supplying reactors to India due to liability concerns under CLNDA.
• Increased Project Costs: Suppliers increased costs to offset potential liabilities, raising the overall expense of nuclear power projects in India.
  For example: The Jaitapur Nuclear Power Project’s costs rose significantly due to liability-related concerns raised by French supplier EDF.
• Delayed Reactor Construction: Legal ambiguities and prolonged negotiations due to liability clauses caused delays in nuclear projects, slowing the expansion of nuclear capacity.

Reforms needed to enhance India’s nuclear capacity

• Amend the CLNDA: Align liability norms with global standards by limiting supplier liability to encourage foreign investment and streamline reactor construction.
  For example: The UAE’s Barakah Nuclear Plant succeeded by adopting global liability norms, attracting foreign collaborations and suppliers.
• Liberalize the Atomic Energy Act (1962): Allow private-sector participation to mobilize capital and foster innovation in reactor construction and management.
  For example: India’s space sector reforms enabled private companies like Skyroot Aerospace to innovate and build satellite launch vehicles.
• Establish a Public-Private Partnership (PPP) Framework: Facilitate collaboration between government agencies like NPCIL and private companies to share costs, expertise, and risks in nuclear projects.
  For example: South Korea’s PPP model in nuclear energy allowed private firms like KHNP to develop advanced reactors for domestic and export markets.
• Promote Indigenous Nuclear Technology: Invest in R&D for domestic reactor designs like AHWR (Advanced Heavy Water Reactor) to reduce dependence on foreign suppliers.
  For example: India’s indigenous PHWR reactors have significantly contributed to the existing nuclear power capacity without external dependency.
• Set up a Nuclear Energy Fund: Create a dedicated fund with contributions from government and private players to support new nuclear projects and ensure uninterrupted financing.
  For example: The French Nuclear Industry Fund supported EDF’s reactor projects, facilitating consistent growth in nuclear energy capacity.

To unlock India’s nuclear potential, we must revamp the Atomic Energy Act to foster private investment and streamline approvals while addressing ambiguities in the Civil Liability for Nuclear Damage Act to ensure investor confidence. “Empowered policies fuel empowered atoms”—with robust reforms, India can lead a clean energy revolution and meet its growing energy demands sustainably.

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