India's nuclear ambitions may be blunted by limits on foreign reactor technology

India's nuclear ambitions may be hindered by a new draft framework that imposes additional requirements on foreign reactors, potentially steering companies towards domestic technology and limiting capital and expertise flow, experts claim. The draft follows India's new nuclear law, passed last year, which opened the country's tightly controlled nuclear sector to private companies and aims to attract foreign technology and investment.

India hopes to attract nearly $210 billion in investments required to increase nuclear power capacity tenfold to 100 gigawatts (GW) over the next two decades, a key aspect of its goal to reduce dependence on coal, which currently supplies most electricity. India's sole nuclear power plant operator, NPCIL, is already executing a 14-GW expansion program through 2032, making private capital and new reactor technologies crucial for meeting the government's 100-GW nuclear target.

Indian conglomerates, such as Tata Power, Adani Power, and Reliance Industries, as well as foreign firms like Rosatom, EDF, and GE Hitachi, have held talks with the government. However, they are waiting to review the final rulebook before making investment commitments. Under the proposed framework, companies seeking imported reactors must obtain operational and licensing certifications from the reactor's country of origin, followed by separate design approval from India's atomic energy regulator before construction begins.

This could potentially limit the flow of new capital and expertise. Suhaan Mukerji, a managing partner at PLR Chambers, warns that the draft rules could render small modular reactor (SMR) technology impractical due to their limited commercial deployment and potential ineligibility under the proposed rules. He emphasizes that SMRs could transform India into a global nuclear leader if the rules do not discriminate between indigenous and foreign technology.

However, industry sources express concerns that the draft rules risk long approval timelines and delay project development by separating design approvals from site approvals. The draft rules also leave several investment-related questions unanswered, including tariff determination, expected returns for investors, and minimum financial and technical qualifications for operators, industry executives state.