New Delhi: Close on the heels of the enactment of the SHANTI (Sustainable Harnessing of Advancement of Nuclear Technology for India) legislation, which paved the way for the entry of private players into the nuclear energy sector, the Union budget 2026 Saturday gave a fresh boost to the sector.
Finance Minister Nirmala Sitharaman recommended extending the existing basic customs duty exemption on imports of goods required for nuclear power projects until 2035, while expanding this exemption to all nuclear plants irrespective of their capacity.
“I propose to extend the existing basic customs duty exemption on imports of goods required for Nuclear Power Projects till the year 2035,” Sitharaman said while presenting her ninth budget.
The basic customs duty on all goods imported for the generation of nuclear power falling under tariff item 8401 30 00 has been reduced to zero from 7.5 percent. The category includes nuclear reactors, fuel elements (cartridges), non-irradiated for nuclear reactors, machinery and apparatus for isotopic separation.
The zero duty will also apply to control and protector absorber rods, and burnable absorber rods for the generation of nuclear power. Currently, the import duty on these items is 7.5 percent.
Goods for specific nuclear power projects registered with the Customs House by 30 September 2035, in compliance with the Project Import Regulations, 1986, will also be subject to applicable duties.
Reducing the basic customs duty on these items will give a fillip to domestic players importing components for nuclear power projects.
In a LinkedIn post, Prasenjit Pal, former executive director and head of the nuclear wing at NTPC Ltd, said the continued customs duty exemption will encourage the nuclear energy push.
“The exemption now applies to all nuclear plants, regardless of their capacity,” he said in the post, adding that the move will reduce project costs, encourage private participation (under the SHANTI Act), and support the expansion of India’s nuclear capacity to 100 GW by 2047.
The Centre enacted the SHANTI law, which is expected to change the trajectory of India’s nuclear energy production, last December. The legislation removes the roadblocks that have held back private companies from participating in the nuclear power sector.
The Department of Atomic Energy is in the process of framing rules to make the law operational.
One of the most important provisions of the SHANTI law allows private companies that are registered or incorporated in India to participate in the nuclear power business in India. The Atomic Energy Act, 1962, has so far barred private sector participation in the nuclear sector.
The entry of private players is expected to enhance India’s limited civil nuclear power, which is currently 8.8 GW, or 1.6 percent of the total energy mix from more than 25 nuclear reactors in seven power plants across the country.
China currently has 57 operating reactors with an installed capacity of 55.3 GW, and 28 more reactors (29.6 GW) are under construction, according to the International Atomic Energy Agency’s Power Reactor Information System.
While opening the door to private players, the government will keep control of some key areas of the nuclear energy business.
This includes fuel, safety and compliance infrastructure, and mining and processing of certain source material containing uranium and thorium. The decommissioning of such mines shall also be carried out only by the government
(Edited by Sugita Katyal)
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