Prime Minister Narendra Modi-led government is mulling to allow up to 49% foreign direct investment (FDI) in the nuclear energy sector. The government is likely to allow FDI in a phased manner. In the initial stage it will go up to 26%, and following a review, the government will decide whether to further raise it or not, the Economic Times reported. This development comes at a time when the government has announced opening the nuclear energy sector for private participation.
“We are open to allowing foreign investment...We can even go up to 49%, but in tranches,” ET reported, citing an official source.
Presently, the sector is not open to private companies and is on the negative list for FDI, as the two crucial pieces of legislation, i.e., the Atomic Energy Act and Civil Liability for Nuclear Damage Act, have still not been amended. The need to amend the laws was highlighted by the union finance minister, Nirmala Sitharaman, during her February budget speech.
“Development of at least 100 GW of nuclear energy by 2047 is essential for our energy transition efforts. For an active partnership with the private sector towards this goal, amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act will be taken up,” Sitharaman had said.
The government has set up a committee for review of the two acts and amendments required to facilitate the private players' entry. The amendment is likely to be taken up in the upcoming monsoon session of Parliament, the Indian Express reported, citing sources.
Earlier in April this year, a consultative committee of the Power Ministry chaired by Union Power Minister Manohar Lal held a discussion on “Roadmap for Development of Nuclear Power Generation”. The minister highlighted the challenges that need to be addressed to scale up nuclear energy generation, including amendment of laws and strengthening public perception and awareness regarding nuclear energy’s safety and benefit.
