India considers lifting the ban on foreign investment in its nuclear power industry to attract more private participation and improve the nation’s energy mix. As part of its push for cleaner energy, the Indian government panel, set up by think-tank Niti Aayog and headed by Prime Minister Narendra Modi, has recommended the move. The panel also proposes to change India’s foreign investment policies, allowing domestic and foreign private companies to complement nuclear power generation by public companies.
At present, India’s Atomic Energy Act 1962 assigns a central role to the government in developing and running nuclear power stations. Domestic private companies are permitted to participate as “junior equity partners” by supplying components and helping build them. The panel’s recommendation is aimed at reducing carbon emissions by allowing private participation through small modular reactors (SMRs) to fast-track nuclear energy generation, which currently accounts for 3% of India’s total power production. Coal fires three quarters of India’s electricity generation.
SMRs are factory-built, ready-to-shift nuclear reactors that can produce up to 300 megawatts (MW) of power, requiring less capital, time and land than conventional reactors. They can also be deployed safely in populated areas. With the emphasis on private participation, foreign companies such as Westinghouse Electric, GE-Hitachi, Electricite de France (EDF.PA), and Rosatom have shown interest in participating in India’s nuclear power projects as technology partners, suppliers, contractors, and service providers. However, India currently prohibits foreign investment in the nuclear power sector.
State-run Nuclear Power Corp of India Ltd. (NPCIL) and Bharatiya Nabhikiya Vidyut Nigam are currently the only two nuclear power generators in India. Thermal power company NTPC (NTPC.NS) and oil marketing firm Indian Oil Corp (IOC.NS), both government-controlled, have formed partnerships with NPCIL for nuclear power.
The panel’s recommendations will be submitted to Prime Minister Modi’s office for approval, though no timeline has been given. The Indian government is also considering replacing old coal-based plants with SMRs as part of its proposal to amend its electricity policy and avoid adding new coal-fired power plants.
India is a signatory to international conventions on nuclear safety, and any private company interested in investing in nuclear power projects will have to comply with strict standards. Currently, India imports uranium fuel for nuclear plants from Russia, Kazakhstan, Uzbekistan, France, and Canada under bilateral agreements.
By opening up the nuclear power sector to private investment and participation, India aims to achieve cleaner and more efficient energy production to meet the growing demand for power in the country.