SHANTI Act 2025: Balancing Nuclear Expansion and Victim Rights

What is the SHANTI Act, 2025?

The SHANTI (Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India) Act, 2025 replaced the Civil Liability for Nuclear Damage (CLND) Act, 2010, to facilitate private-sector and foreign participation in India's civil nuclear sector through a more predictable liability framework.

Key Provisions:

• Statutory Status to AERB: Grants the Atomic Energy Regulatory Board (AERB) formal statutory authority for nuclear safety oversight
• Strategic State Control: Reserves uranium enrichment, spent-fuel reprocessing, high-level waste management, and heavy-water production exclusively for the Central Government or its wholly owned institutions
• Dispute Redressal: Establishes the Atomic Energy Redressal Advisory Council, with the Appellate Tribunal for Electricity as appellate authority
• Company Definition: A "company" means under Section 2(20) of the Companies Act, 2013, excluding foreign-incorporated entities

Comparison: CLND Act 2010 vs SHANTI Act 2025

CLND Act 2010 (Previous Framework):

• Liability Regime: "No-fault regime" — victims only prove damage, not negligence
• Operator Liability Cap: Rs 1,500 crore for large reactors
• Overall Maximum: 300 million Special Drawing Rights (SDR)
• Supplier Accountability: Operators had statutory "right of recourse" against suppliers for defective equipment or latent defects

SHANTI Act 2025 (New Framework):

• Tiered Operator Liability (based on thermal capacity):

• State Absorption: Central Government covers claims after operator's limit is exhausted
• Overall Ceiling: 300 million SDR (or higher as notified)
• CSC Mechanism: If compensation exceeds ceiling, Government may access Convention on Supplementary Compensation (CSC) funds
• Diluted Supplier Liability: Suppliers largely shielded unless expressly provided in contract or incident caused intentionally

Additional Restrictions:

• Adjudication: Claims Commissioner or Nuclear Damage Claims Commission; ordinary civil courts excluded
• Time Limits: 10 years (property damage), 20 years (personal injury)
• RTI Override: Government can classify nuclear operational information as "restricted"

Major International Nuclear Liability Conventions

1. Paris Convention (1960): OECD NEA framework establishing strict, channelled liability
2. Vienna Convention (1963): IAEA framework harmonising national laws with minimum compensation standards
3. Brussels Supplementary Convention (1963): Additional public funds beyond operator liability
4. Convention on Supplementary Compensation (CSC), 1997: Global framework for international compensation pool; open to all states

India's Position: Not party to Paris or Vienna Conventions. Ratified CSC in 2016. Not party to 2026 Amendment revising public-fund contribution formula.

Nuclear Liability Concerns Under SHANTI Act

1. Inadequacy of Liability Ceilings

• 300 million SDR ≈ Rs 3,900-4,000 crore is significantly low compared to potential nuclear accident costs
• Chernobyl: Estimated losses of USD 235-700 billion
• Fukushima: USD 400-445 billion in clean-up, decommissioning, and compensation
• Nuclear disasters cause multi-generational damage: environmental contamination, mass displacement, radiation-related health impacts, long-term land-use restrictions

2. Restrictive Time Limits

• 10 years for property damage, 20 years for personal injury ignores scientific realities
• Radiation-induced cancers, genetic damage, and congenital anomalies can emerge decades after exposure

3. Risk of Weaker Safety Incentives

• Capped liability may insulate operators from full economic consequences of accidents
• Reduces incentives for advanced safety systems, rigorous maintenance, and operational redundancy
• Weakened supplier accountability further weakens the safety feedback loop

4. Constitutional and Legal Fault Lines

Article 21 - Erosion of Absolute Liability:

• Supreme Court in M.C. Mehta v. Union of India (1987): Enterprises in inherently hazardous activities are absolutely liable for all damages without exception
• Statutory liability caps create an artificial shield contravening this doctrine

Polluter Pays Principle Violation:

• Recognised in Indian Council for Enviro-Legal Action v. Union of India (1996)
• Shifting residual liability to Central Government transfers burden of private nuclear activities to taxpayers

Article 14 - Arbitrary Classification:

• Tiering liability by reactor size (as low as Rs 100 crore) fails the test of reasonableness
• Even minor reactor failures can trigger severe radiation hazards

Article 19(1)(a) - Information Suppression:

• Section 39 overriding RTI Act, 2005 prevents public access to vital safety audits
• Affected citizens lack evidence needed to establish legal claims

5. Institutional Deficits - AERB Independence

• Government controls appointment of AERB Chairperson and members
• Creates institutional conflict of interest: same body promotes nuclear energy and oversees its regulation
• Nuclear safety watchdog requires complete institutional, financial, and technical autonomy

Measures to Strengthen Nuclear Liability Framework

1. Establish Independent Nuclear Safety Regulator

• CAG Report: 85% shortfall in regulatory inspections of hazardous sites; absence of National Nuclear Safety Policy
• Raja Ramanna Committee (1997): Recommended amending Atomic Energy Act, 1962 to strengthen regulatory effectiveness
• NSRA Bill, 2011: Proposed Nuclear Safety Regulatory Authority (NSRA) following Mayapuri radiation accident (2010) and Fukushima disaster (2011); Bill lapsed without establishing autonomous regulator
• Would resolve structural conflict where DAE both promotes nuclear energy and regulates it

2. Leverage CSC's International Compensation Mechanism

• India ratified CSC in 2016; should develop mechanisms to access international supplementary compensation pool
• Provides additional victim compensation without burdening Indian exchequer

3. Strengthen India Nuclear Insurance Pool (INIP)

• Expand INIP managed by General Insurance Corporation of India
• Complement with international reinsurance and Sovereign Catastrophe Bonds (Cat-Bonds)
• Cover losses beyond statutory liability limits

4. Contractual Enforcement of Supplier Liability

• NPCIL and private operators must make contractual right of recourse mandatory
• All bilateral procurement contracts must explicitly encode supplier liability for latent design defects
• Bypass statutory loophole while remaining CSC-compliant

Drishti Mains Question

The SHANTI Act, 2025 seeks to promote private participation in nuclear energy while restructuring nuclear liability. Examine whether its liability framework adequately balances investment interests with citizens' right to life under Article 21.