JSA Prism | Energy | September 2026

Please click here to download the Prism as a PDF.

Draft Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Rules, 2026: Key features and implications

On August 14, 2026, the Central Government released the draft Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Rules, 2026 (the “Draft Rules”), for public consultation. The Draft Rules seek to operationalise the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025 (the “Act”) by prescribing the procedures and requirements for its implementation. In doing so, they clarify a calibrated opening of India’s nuclear sector, replacing a State-led monopoly with a licence-based framework in which private and foreign participants must demonstrate regulatory readiness across the entire life of a facility.

The Draft Rules primarily set out the following key aspects: (a) licensing framework; (b) permitted end use; (c) exploration, mining and extraction; (d) early engagement; (e) applicant’s capability; (f) foreign reactor technology and supply chains; (g) safety, security and safeguards; (h) mandatory financial protection; (i) decommissioning costs; (j) continuing oversight; and (k) transfer of license.

Salient features

• Licensing framework: The Draft Rules establish a licensing framework enabling eligible persons to undertake specified peaceful nuclear activities. A licence is mandatory for setting up or undertaking facilities or activities relating to the production, use and disposal of nuclear energy, including: (a) building, owning, operating or decommissioning a Nuclear Power Plant (“NPP”) or reactor; (b) fabrication of nuclear fuel, including conversion and refining or any other notified associated activities; (c) transportation or storage of nuclear fuel, spent fuel or other prescribed substances; (d) import, export, acquisition or possession of nuclear fuel or prescribed substances; (e) import, export, acquisition or use of prescribed equipment; (f) import or export of technology or software that may be used for the development, production or use of prescribed substances or equipment; or (g) such other facilities or activities as may be notified by the Central Government. The licence is single, composite and non-severable, covering establishment, operation and decommissioning.
• Permitted end uses: The Draft Rules permit NPP and reactors to be used for peaceful applications, including: (a) electricity generation for supply to the grid or captive consumption; (b) process heat and hydrogen production, including hybrid systems combining heat, hydrogen and electricity; (c) isotope production for medical and other applications; and (d) education, training and research.
• Exploration, mining and extraction: The Draft Rules adopt different regulatory frameworks for exploration, mining and extraction of uranium, thorium and other prescribed substances.

• • At the exploration stage, the Atomic Minerals Directorate for Exploration and Research is empowered to undertake exploration, while other persons permitted under the Mines and Minerals (Development and Regulation) Act, 1957 may also undertake such activities. Where exploration may involve radiation exposure, the person undertaking it must obtain safety authorisation from the Atomic Energy Regulatory Board (“Board”), unless the Board exempts such activities by notification.
  • At the mining stage, mining of uranium- and thorium-bearing minerals meeting the notified grade threshold may be undertaken only by the Government or a Government company or corporation owned or controlled by the Government and nominated by the Central Government under the Atomic Minerals Concession Rules, 2016. The licensing requirement may also extend to other mines from which uranium, thorium or other prescribed substances can reasonably be isolated or extracted, where so specified by the Central Government.
  • At the extraction stage, a licence may be granted to any eligible person to establish, operate and decommission plants for extracting uranium or thorium from primary sources, including through milling and processing of ores, or from specified secondary sources through treatment or concentration of relevant materials. The licensing framework also covers the processing or production of other prescribed substances, subject to the applicable requirements under the Draft Rules.
• Early engagement: The Draft Rules provide for an early engagement process under which the licensing authority assesses an applicant’s credentials and preparedness for the proposed project, including site selection, technology, safety, security, safeguards, quality assurance, liability, and waste and spent-fuel management, before admitting an application. Where the site or technology has not yet been selected, an in-principle approval may be granted, revocable in prescribed circumstances after an opportunity of being heard.
  Where the site or technology has not yet been selected, the licensing authority may grant an in-principle approval, enabling the applicant to engage with reactor technology vendors and undertake preliminary arrangements for land and related infrastructure. The licensing authority may revoke such approval at any time, after giving the applicant an opportunity to be heard, if a supervening public interest arises, material facts emerge indicating that the applicant is owned, controlled or dominated by entities inimical to defence and national security or public health and safety, or the approval is found to have been obtained through misrepresentation or suppression of a material fact.
  Once the site and technology are selected, the applicant must submit the requisite information, and the licensing authority may then grant the licence after reviewing any material change in credentials.

• Applicant’s capability: The Draft Rules make an applicant’s financial, managerial and technical capabilities a key consideration for grant of a licence. Applicants must furnish information demonstrating:
  • financial capability, including project and operating cost estimates, funding sources, ownership structure, net worth, turnover, financial statements, solvency and creditworthiness;
  • managerial capability, including arrangements for financing, fuel supply, spent fuel and radioactive waste management, decommissioning, and engagement with technology developers, suppliers and other relevant nuclear supply chain entities; and
  • technical capability, including relevant experience, availability of qualified personnel, lifetime design support arrangements, and oversight of designers, manufacturers, suppliers and contractors.
    Newly incorporated entities must make additional disclosures relating to their ownership and capital structure and, where reliance is placed on a parent, promoter or affiliate for funding or other obligations, the financial capacity and legally binding commitments of such entities to support the applicant.

• Foreign reactor technology and supply chains: The Draft Rules permit the use of both indigenous and foreign reactor technology, subject to regulatory and strategic safeguards. Technology may be sourced either from the original developer or through an authorised technology provider, with appropriate arrangements for design support and intellectual property rights. Foreign-designed reactors must have regulatory approval in the country of origin and be operational in a foreign jurisdiction, and imports remain subject to national security, safety, nuclear-transfer requirements and Government policy.
  For foreign-designed reactors, the reactor design must have regulatory approval in its country of origin and be operational in that or another foreign jurisdiction. Accordingly, only technology originating from jurisdictions with established reactor-design capabilities, mature supply-chain ecosystems and globally recognised regulatory oversight are envisaged. The import or acquisition of technology, equipment and materials will be subject to national security, public health and safety considerations, applicable nuclear-transfer requirements and Government policy.

• Safety, security and safeguards: Safety, security and safeguards related obligations will continue throughout the lifecycle of a nuclear facility. Licensees must comply with applicable safety authorisations, regulatory oversight and safeguards requirements during siting, construction, commissioning, operation and decommissioning.
  Licensees will be responsible for safety, emergency preparedness, security, physical protection, record-keeping, incident reporting and nuclear material accounting and control. The regulatory framework would apply equally to public and private sector projects.

• Mandatory financial protection: The Draft Rules operationalise the Act’s civil liability framework. Operators are subject to strict, no-fault liability for nuclear damage within the limits prescribed under the Act. Operators must maintain insurance, financial security, or a combination of both against such liability, valid until completion of the prescribed spent-fuel management obligations. The Rules also permit joint financial security arrangements among operators, subject to prescribed requirements. The Central Government may assume liability for Central Government-owned installations.
• Decommissioning cost: The Draft Rules require decommissioning and site-remediation costs to be planned and funded throughout the lifecycle of a nuclear facility. Licensees must maintain prescribed financial assurance for decommissioning and site remediation, established before commissioning and held separately from their other assets, based on the facility’s characteristics and decommissioning strategy, and subject to Government oversight.
• Licensees must establish such financial assurance before commissioning, maintain it separately from their other assets and keep it subject to Government oversight. Similar financial assurance requirements also apply to other prescribed nuclear facilities and activities.

• Continuing oversight: The Draft Rules provide for continuing regulatory oversight after the grant of a licence. The Central Government and the Atomic Energy Regulatory Board have powers to inspect facilities, verify compliance, investigate incidents and require corrective measures.
• The licensing authority may modify, suspend or cancel licences, and approvals for non-compliance, and significant changes, including transfers of licences, changes in ownership and material modifications to facilities, would remain subject to regulatory review or approval. Life extension of facilities would also require regulatory clearance.

• Transfer of license: The Draft Rules permit the transfer of a licence with the prior approval of the licensing authority. Before approving a transfer, the licensing authority must assess the credentials and capabilities of the proposed transferee. Upon transfer, all rights, obligations, responsibilities and liabilities of the transferor under the Act and the applicable rules and regulations automatically vest in the transferee. Any transfer of the corresponding safety authorisation must comply with the applicable regulations.

Conclusion

The Draft Rules have wide ranging implications beyond nuclear power plant developers to also include technology developers and providers, manufacturers, suppliers, transporters, radiation facilities, mines, research institutions and public authorities. For businesses seeking to enter or participate in the sector, the key takeaway is that regulatory readiness would need to be demonstrated at the outset. This would include financial capacity, technical and managerial capability, access to appropriate technology and supply chains, safety, security and safeguards arrangements, liability protection, spent-fuel management and adequate funding for decommissioning and site remediation.

The Draft Rules seek to make nuclear projects a lifecycle commitment rather than a one-time exercise focused on construction and commissioning. Its effectiveness will ultimately depend on how the proposed mechanisms for early regulatory engagement, licensing hold points, continuing safety, security and safeguards oversight, operator financial protection, spent-fuel management and decommissioning funding operate in practice. If notified and implemented effectively, the framework could facilitate wider private participation and access to technology while ensuring that regulatory responsibility, financial obligations and Government oversight remain embedded throughout the life of a nuclear facility. The proposed framework therefore represents a calibrated opening of the sector, rather than a relaxation of regulatory control, with project developers subject to stage-specific approvals and continuing regulatory scrutiny through operation and decommissioning.

This Prism has been prepared by:

Vishnu Sudarsan Partner

Sugandha Somani Gopal Partner

Asmita Maan Senior Associate

Vihaan Pathak Associate

For more details, please contact km@jsalaw.com.