India's Nuclear Sector Opens to Private Investment Amidst Power Infrastructure Expansion

Prime Minister Narendra Modi announced that the nuclear energy sector in India is now open to private participation. This development coincides with ongoing work on small modular reactors and the expansion of the country's transmission network. These efforts are part of a broader strategy to strengthen India's power infrastructure, which is considered vital for supporting the expanding semiconductor ecosystem and the increasing demand for computing power driven by artificial intelligence.

Modi highlighted the government's commitment to enhancing power infrastructure, noting a significant increase in India's installed solar capacity from 2 GW to over 160 GW. A robust power infrastructure is expected to play a key role in establishing India as a global hub for semiconductor manufacturing, thereby strengthening the global supply chain.

Electrification Remains Key Despite Grid Challenges, IEA Reports

The International Energy Agency (IEA) reports that electrification remains a primary focus for capital markets, despite ongoing challenges related to grid capacity and affordability. IEA Executive Director Fatih Birol noted that electricity demand is increasing three times faster than total energy demand, with 61% of global energy investment this year directed towards electricity, compared to 39% for fossil fuels.

Birol identified insufficient grid capacity and the need for affordable electricity as key obstacles to broader electrification. He suggested that governments could address these issues through financing measures. These remarks were made during the launch of RISE ASIA, a new energy security partnership with South Korea's Energy Minister Kim Sung-whan. The partnership aims to strengthen responses to energy crises and facilitate the shift of Asian economies from fossil fuels to electrification.

The initial focus of RISE ASIA will be Southeast Asia, with a target of achieving 35% electrification by 2035, to be announced around the COP31 climate summit. South Korea's manufacturing base, a major producer of equipment such as batteries, wires, cables, and transformers, is expected to provide a practical advantage for electrifying the region.

A great discussion on the future of financing India’s nuclear ecosystem.

A great discussion on the future of financing India’s nuclear ecosystem.

Thank you to everyone who joined our latest NucFinder webinar, and especially to our speakers: Kapil Bansal, Partner at EY-Parthenon India and Hiten Sutar, Partner at EY India.

We discussed how the emerging regulatory landscape and SHANTI Guidelines may influence financing, market entry, project bankability, foreign investment and participation across India’s nuclear ecosystem.

Many thanks to Kapil and Hiten for sharing their perspective and experience, and to everyone who joined the discussion.

We’ll be announcing our next NucFinder webinar soon.

Stay tuned.
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