The enactment of the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Bill (SHANTI), 2025, in the just-concluded session of the Indian parliament by the Modi government will make American nuclear companies happy, as their entry into the Indian market is now much easier. The French companies that wanted to do business with India in the nuclear field will also be pleased.

But is SHANTI enough for India to become a member of the important Nuclear Suppliers Group (NSG) whose 48 members that govern global nuclear trade worth about $ 40 billion (as of 2025) annually by implementing sets of guidelines for the export of nuclear-related items specially designed or prepared for nuclear use, and the dual-use items and technologies related to the nuclear fuel cycle and nuclear weaponization?

India’s application for entry to the NSG has been pending since 2016.

It may be noted that it was the United States that had initiated the process of ending India’s nuclear isolation, following its first nuclear explosion in 1974,  by signing with India a civil nuclear cooperation agreement (123 agreement) in 2008 after New Delhi concluded a safeguards agreement with the International Atomic Energy Agency (IAEA).

The NSG, thanks to the relentless pressure by the then US President George Bush,  now agreed with a waiver for India so that any NSG member country could do nuclear business with it, even though New Delhi was not a party to the NPT.

Subsequently, India signed civil nuclear cooperation agreements with France, the United States, Russia, Namibia, Canada, Argentina, Kazakhstan, the Republic of Korea, the Czech Republic, Australia, Sri Lanka, and the United Kingdom.

A Memorandum of Understanding on civil nuclear cooperation has also been signed with Mongolia. In December 2015, India and Japan exchanged a Memorandum, as per which both sides confirmed having reached an agreement on an Agreement for Cooperation in the Peaceful Uses of Nuclear Energy.

However, as EurAsian Times pointed out earlier, it is Russia, not America or others, that reaped the real dividends of the landmark India-US civil nuclear agreement. And that was due to India’s Civil Liability for Nuclear Damage Act (CLNDA), 2010, which discouraged American and other Western companies from entering India’s nuclear market by proposing compensation beyond international practice in the event of a nuclear accident at a plant.

The provisions of the CLNDA were such that if you were a supplier, you could not even calculate your liability.

Russia found a way out by buying high insurance premiums, though in the event of any accident, it would be extremely difficult to quantify the exact compensation amount due to CLNDA.

But this is a risk international nuclear companies such as GE-Hitachi and Toshiba-Westinghouse did not dare to take, even though they were awarded the right to build nuclear power plants at Kovvada (Andhra Pradesh) and Mithivirdi (Gujarat).

Predictably, both the Biden Administration and the Trump Administration had requested that the Modi government amend the restrictive liability provisions of its nuclear acts. In fact, in his first meeting with Modi after assuming office for the second time, President Trump had talked of the need to implement the Indo-US nuclear agreement signed years ago.

SHANTI seems to have addressed these concerns by proposing a clearer allocation of responsibilities among operators, suppliers, and other stakeholders. It also provides for the establishment of a dedicated atomic disputes tribunal.

This specialised body is intended to address disputes related to nuclear operations, contracts, and liabilities, offering a structured mechanism for resolution within the sector.

It is said that this clearer, investor‑friendly nuclear law can make India a more attractive destination for global nuclear vendors and finance, reinforcing strategic partnerships with supplier countries while maintaining sovereign control over sensitive fuel‑cycle elements.

SHANTI could also strengthen India’s membership bid in the NSG, as CLNDA had hitherto projected New Delhi as hostile to foreign nuclear companies.

But whether that is enough to neutralise the China-factor remains to be seen.

China has virtually made India’s membership in the NSG conditional on granting the membership simultaneously to Pakistan. Incidentally, at China’s behest, Pakistan had applied for NSG membership in 2016, immediately after India.

Of course, Rafael Mariano Grossi, an Argentine diplomat and former NSG chairman, who now heads the IAEA, had, between 2016 and 2018, crafted, with the strong backing of the U.S., a solution that would permit India to join the NSG, but it was opposed by China.

Since 2018, the NSG has not made any membership decisions, although in the meantime, the Indian and Pakistani applications have been joined by applications filed by Jordan and Namibia.

Incidentally, during one of his visits to India as the NSG Chairman, the author had the opportunity to speak with Ambassador Rafael M. Grossi. Underscoring the importance of the NSG, given the growing global demand for clean nuclear energy, he had pointed out that the NSG was working to ensure transparency in nuclear trade.

The NSG guidelines require that importing states provide assurances to NSG members that proposed deals will not contribute to the creation of nuclear weapons. Potential recipients are also expected to have physical security measures in place to prevent theft or unauthorised use of their imports, and to promise that nuclear materials and information will not be transferred to a third party without the original exporter’s explicit permission.

In addition, the final destination of any transfer must have IAEA safeguards in place. The IAEA is charged with verifying that non-nuclear-weapon states are not illicitly pursuing nuclear weapons. IAEA safeguards are to prevent nuclear material or technology from being stolen or misappropriated for weapons, including inspections, remote monitoring, seals, and other measures.

The guidelines comprised two parts, each created in response to a significant proliferation event that highlighted shortcomings in the then-existing export control systems.

Part 1 lists materials and technology designed specifically for nuclear use. These include fissile materials, nuclear reactors and equipment, and reprocessing and enrichment equipment.

Part 2 identifies dual-use goods: non-nuclear items with legitimate civilian applications that can also be used to develop weapons. Machine tools and lasers are two types of dual-use goods.

In sum, Grossi told EurAsian Times, “The mandate of the NSG is to produce, export, import nuclear material and equipment; exchange information on export and import policies; prevent misuse or abuse of legitimate trade of nuclear goods for hostile use and offer technological expertise to countries seeking its assistance.”

Once a country is admitted as an NSG member, what benefits does it accrue? Does it make access to technology, equipment, and materials easier? Does each transfer have to be approved by the NSG?

Grossi’s answers were, “In today’s world, no country operates in isolation. The nuclear industry is a big industry, and you must have international cooperation as well as the needed mechanisms. Here, the membership of the NSG helps in providing comforts to both the nuclear supplier and recipient. Once admitted, an NSG member (1) gets timely information on nuclear matters, (2) contributes by way of information, (3) has confirmed credentials, (4) can act as an instrument of harmonisation and coordination, and (5) is part of a very transparent process concerning the material, equipment, and technology. These advantages cannot be quantified, but they generate a very positive atmosphere.”

However, Ambassador Grossi made it clear that not every transfer of information related to the nuclear field requires NSG approval. “The NSG is not a supra-national authority. It is only a mechanism for exchange of information; it provides a forum for consultation,” he said.

Importantly, he was evasive on India’s prospects for joining the NSG.

“India’s membership quest is a work in progress. India is important. No member in NSG is against India. India is far more advanced in nuclear energy than many NSG members. You just cannot ignore India. India is a key nuclear power that has focused on developing its nuclear energy for use in the agriculture sector, in the field of medicine, and in the development of its nuclear plants. It has an excellent reputation and an indisputable role, which will be even more important in the future. The globalisation of India’s nuclear programme is something to be welcomed.

“But then, ultimately, it (decision on India’s membership) is going to be a political decision. The NSG functions on the premise of compatibility and consensus through established guidelines. “If I were to talk about how India could contribute to strengthening the NSG, I would say, in a very general statement, that all countries active in the nuclear field have something to contribute. Nobody denies this fact. The important thing is to fine-tune the process, where consensus can be achieved, to do it in a fair, concise, and transparent manner.”

However, Ambassador Grossi was hopeful that there would be a consensus on India. And he had a point when he said, “My role as the chairman of the NSG is to facilitate the process of consensus on India’s membership. As it is, without being a member of the NSG and without being a signatory to the nuclear non-proliferation treaty (NPT), India has already received some concessions from the IAEA in 2008 on nuclear trade. So in India’s case, we are no longer very orthodox and legalistic. My responsibility, therefore, is to tell everybody where we can meet halfway. I am playing the role of an honest broker on the question of India’s membership. In fact, my experience in the Chemical Weapons Convention (CWC) tells me that we can find a consensus on India. If in CWC, India, Pakistan, and China could agree, it is not impossible to see India joining the NSG.

I want to emphasise the particular sentence of Ambassador Grossi – “So in India’s case, we are no longer very orthodox and legalistic.”

But this is precisely what China is being when it talks of blocking India because it is not a member of the NPT. Even legally, China does not make any sense when it says that membership of the NPT is a prerequisite for NSG membership.

When the NSG was set up in 1974, France, then a non-signatory to the NPT, became a member. Japan had not ratified the NPT when it joined the NSG—neither had Argentina and Brazil. The truth is that the Chinese objection to India’s membership in the NSG is essentially political.

In fact, when one talks of the non- proliferation of nuclear or any other dangerous materials,  India has demonstrably behaved responsibly. After all, between 2016 and 2018, India succeeded in joining three multilateral export control regimes: the Wassenaar Arrangement for munitions and dual-use items, the Missile Technology Control Regime for missiles and related technology, and the Australia Group for chemical and biological weapons-related goods. India viewed its membership in these arrangements as providing credibility for its pending NSG application.

But China is not impressed. Because of the consensus principle in NSG, it is blocking India and will continue to do so, at least until its ally Pakistan’s similar aspirations are entertained.

How to overcome this is India’s new nuclear challenge.

• Author and veteran journalist Prakash Nanda is Chairman of the Editorial Board of the EurAsian Times and has been commenting on politics, foreign policy, and strategic affairs for nearly three decades. He is a former National Fellow of the Indian Council for Historical Research and a recipient of the Seoul Peace Prize Scholarship.
• CONTACT: prakash.nanda (at) hotmail.com