In its 2024-25 budget announcement, the Indian government has revealed plans to collaborate with the private sector for the development of small modular reactors (SMRs).
This initiative underscores the significant role nuclear energy is expected to play in the country’s future energy landscape.
Nuclear Energy’s Role in Viksit Bharat
Finance Minister Nirmala Sitharaman, while presenting the budget to Parliament, emphasized that nuclear energy is anticipated to be a “crucial” component of the energy mix for Viksit Bharat, the government’s ambitious strategy to achieve comprehensive national development by 2047.
Budget Outlines Roadmap for Development Goals
This budget, the first since Prime Minister Narendra Modi’s third consecutive term, provides a detailed roadmap for the government’s pursuit of its development objectives.
It aligns with the strategy outlined in an interim budget presented earlier in February, where energy security was identified as one of nine priorities for realizing Viksit Bharat.
Partnership to Develop Bharat SMRs
Sitharaman, in her budget speech, stated, “To achieve this, our government will partner with the private sector to (1) establish Bharat Small Reactors, (2) pursue research and development of Bharat Small Modular Reactors, and (3) invest in research and development of emerging technologies for nuclear energy.” She further assured that the R&D funding announced in the interim budget would be made available for this sector.
Budget Allocation for Atomic Energy
The budget allocates a substantial sum of INR 24,969 crore (USD 2.983 billion) to the Department of Atomic Energy.
Policy for Energy Transition and Renewable Energy
Sitharaman mentioned the government’s intention to introduce a policy document outlining “appropriate” energy transition pathways, balancing employment, growth, and environmental sustainability.
In addition to the commitment to nuclear energy, the budget includes a significant project for rooftop solar installation and a policy to promote pumped storage projects, facilitating the integration of renewable energy.
Additionally, the government will provide fiscal support for the construction of a full-scale 800 MWe commercial Advanced Ultra Super Critical thermal power plant and develop a roadmap to transition “hard to abate” industries towards emission targets.
India’s Existing Nuclear Capacity and Future Plans
India currently operates 23 nuclear reactors with a combined generating capacity of approximately 7,425 MWe. Seven units are under construction, including both indigenous designs and Russian-designed units, as well as a fast breeder reactor.
The country has plans for a fleet of indigenously designed and built 700 MWe pressurized heavy water reactors, as well as large reactors from international vendors, including more Russian-designed VVER reactors in addition to those already operational and under construction at Kudankulam in Tamil Nadu.
Growing Interest in Small Modular Reactors
Recently, India has shown increasing interest in small modular reactors (SMRs). In August 2023, Minister of State Jitendra Singh informed the parliament that the government was evaluating options for SMRs and exploring ways to involve the private sector and startups in such projects.
Potential for Private Sector Participation
While India’s Atomic Energy Act of 1962 prohibits private control of nuclear power generation, with only two government-owned enterprises allowed to own and operate nuclear power plants, the possibility of involving other public sector and private corporations in future expansion plans has been under consideration.
Earlier this year, government sources indicated that India was planning to invite private firms to invest approximately USD 26 billion in its nuclear energy sector. Discussions with several private firms are ongoing to secure investments to support the construction of around 11,000 MWe of new nuclear capacity by 2040.