Mint Explainer | How nuclear energy gives India a strategic trump card in US trade talks
Nuclear power is taking centre stage in the India-US trade negotiations as India strives to enhance its nuclear capacity. With ambitious plans to expand from 8.8GW to 100GW by 2047, India seeks global partnerships for small modular reactors (SMRs).
Nuclear power has emerged as a key component of the ongoing India-US bilateral trade negotiations. India needs global partnerships, including with US companies, as the country looks to increase its nuclear power capacity and develop small modular reactors (SMRs).
As SMRs are not commercially viable, Indian energy companies, both public and private, are in talks with US and global companies such as Westinghouse Electric Co. for partnerships and technology transfer.
Mint looks at how nuclear energy can play a key role in the bilateral trade talks.
Q. How can nuclear power boost the energy partnership between India and the US?
India plans to expand its nuclear power generation capacity from the current 8.8GW to 22GW in 2032 and 100GW in 2047. Along with conventional nuclear power plants, India is also looking to develop SMRs, for which it would require technological know-how from overseas, including US nuclear technology companies.
Westinghouse Electric Co. and Holtec International are expected to tie up with Indian companies to develop SMRs. These are advanced nuclear reactors with a power generation capacity ranging from less than 30MW to 300MW and provide a flexible, scalable and cost-effective alternative to conventional large nuclear reactors.
Q. What does India's nuclear power market offer US companies?
Along with technological know-how for developing indigenous SMRs, a nuclear partnership is also seen as a bargaining factor for a favourable trade deal, opening up India's market to US companies. According to experts, India’s nuclear energy sector offers a $100 billion market for international collaboration and investment.
Private and public sector companies including Indian Oil Corp., NTPC, Oil & Natural Gas Corp., Nuclear Power Corp. of India, Vedanta Group, Tata Power, Reliance and the Adani Group have shown interest in developing SMRs and all of them would require global partnerships.
Indian Oil CMD Arvinder Singh Sahney told Mint in July that the company is preparing a strategy for nuclear power generation. NTPC has already set up a subsidiary, NTPC Parmanu Urja Nigam Ltd. Mint reported earlier that the company is eyeing global partnerships for SMRs.
Q. Have India and the US collaborated on nuclear power generation in the past?
A. In 2008, India and the US negotiated the 123 Agreement, under which India agreed to place civilian nuclear facilities under International Atomic Energy Agency safeguards. The US amended its 1954 Atomic Energy Act to facilitate deeper cooperation with India. Following the deal, six 1,000-MW AP1000 reactors were to be developed by Westinghouse with the Nuclear Power Corp. of India.
However, the US-India partnership has faced unresolved liability and regulatory hurdles. The Indian Civil Liability for Nuclear Damage Act was passed in 2010 to establish a legal framework for liability and compensation in the event of a nuclear accident. It contains provisions on recourse liability for suppliers due to substandard or faulty equipment, potentially allowing the public to initiate liability.
These provisions dampened the interest of global companies in India’s nuclear market. The US government also reacted adversely, reinstating some of its previous restrictions. However, there has been some movement on this front of late.
An S&P Global Commodity Insights report last month noted that towards the end of the Biden administration, India and the US revitalized their civil nuclear cooperation. This momentum has continued under the Trump administration, with the Catalyzing Opportunities for Military Partnership, Accelerated Commerce and Technology (COMPACT) initiative signed in February 2025, which, apart from defence and outer space cooperation, also aims to have US-designed advanced nuclear reactors built in India, including assistance with SMRs.
In late 2024, Chicago-based Clean Core Thorium Energy offered its advanced nuclear energy for enriched life (ANEEL) fuel technology to improve reactor efficiency and allow the blending of abundant domestic thorium. ANEEL is formed by combining thorium with high-assay low-enriched uranium.
In March, the US Department of Energy allowed Holtec International to build and design nuclear reactors in India, opening up the way for partnerships in this space.
Q. What is India’s current nuclear power generation capacity?
A. India operates 25 nuclear reactors across seven locations, with a total installed capacity of 8,880MW (8.8GW), contributing about 3% of the country's electricity generation. Eight reactors with 6,600MW capacity are under construction, and 10 reactors with 7,000MW capacity are in pre-project stages.
Q. What measures has the government taken to boost nuclear power?
A. Nuclear power has gained momentum in the past few years on the back of the government's plan to achieve 500GW of non-fossil power generation capacity by 2030. Considered a clean and non-fossil power source, nuclear power is expected to add to the country's ambitious energy transition goals.
In the Union Budget for FY26, the government announced the rollout of the Nuclear Energy Mission with an allocation of ₹20,000 crore to support local development and manufacturing of SMRs.
Under the mission, the government will enter into partnerships with the private sector to set up Bharat Small Reactors (BSR), research & development of Bharat Small Modular Reactor (BSMR), and R&D of newer technologies for nuclear energy. BSRs are 220MW pressurized heavy water reactors (PHWR).
The Centre has also said that it would amend the Atomic Energy Act, 1962, and the Civil Liability for Nuclear Damage Act, 2010, to enable participation by the private sector in this space.
The Union power ministry is also looking at repurposing old and retired thermal power plants for nuclear power generation. The ministry has asked for land to be allocated for at least one nuclear power plant in each state.
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