US clears landmark nuclear deal, paving way for reactor development in India

In a major breakthrough nearly two decades after the landmark India-US civil nuclear deal was signed, the US Department of Energy (DoE) has granted regulatory clearance for an American company to design and build nuclear reactors in India.

On March 26, the DoE approved Holtec International’s application under the stringent “10CFR810” regulation — an essential step under the US Atomic Energy Act of 1954 —allowing the transfer of unclassified small modular reactor (SMR) technology to three Indian firms: Tata Consulting Engineers Ltd, Larsen & Toubro Ltd, and Holtec’s regional subsidiary, Holtec Asia.

Holtec International, founded by Indian-American entrepreneur Kris P. Singh, has been operating in India for over a decade, with an engineering unit in Pune and a manufacturing facility in Dahej, Gujarat. While Holtec had initially sought approval for additional Indian entities — including state-owned Nuclear Power Corporation of India Limited (NPCIL), NTPC Ltd., and the Atomic Energy Regulatory Board (AERB) — the Indian government has yet to provide the necessary non-proliferation assurances for these entities.

A game-changer for India's nuclear ambitions

The authorization, valid for ten years with a five-year review, marks a crucial step in overcoming a regulatory hurdle that had stalled progress on the nuclear agreement. Until now, US regulations permitted companies like Holtec to export nuclear equipment to India under strict safeguards but prohibited them from manufacturing or engaging in nuclear design work within the country—a major sticking point for New Delhi, which seeks to build SMRs domestically.

Under the latest clearance, India must ensure that the transferred technology is used strictly for peaceful nuclear activities under International Atomic Energy Agency (IAEA) safeguards. It also prohibits retransferring the technology to other Indian entities or foreign countries without explicit US consent. Holtec is required to submit quarterly reports to the DoE detailing the assistance provided to its Indian partners.

Boost for US-India nuclear cooperation

The decision comes on the heels of renewed efforts to fully implement the India-US 123 Civil Nuclear Agreement, signaling a deeper diplomatic commitment to energy collaboration. At a time when the US has adopted a more transactional approach to trade and manufacturing, this move is being seen as a strategic win for India, which has long pushed for technology transfers to boost its nuclear industry.

For India, the deal presents an opportunity to modernize its nuclear reactor technology. Currently, India primarily relies on pressurized heavy water reactors (PHWRs) that use natural uranium, a technology increasingly outpaced by the globally dominant pressurized water reactors (PWRs). By partnering with Holtec, India could accelerate its entry into the SMR sector—a growing segment in global nuclear energy.

India, US eye competition with China in SMR race

The agreement also sets the stage for potential India-US collaboration to counter China’s expanding influence in the SMR industry. While China was a latecomer in large nuclear reactors, it has aggressively positioned itself as a leader in SMR development, particularly in the Global South. Both India and the US face challenges in competing with China independently—India due to technological constraints and the US due to high labor costs and growing protectionist policies.

Holtec’s manufacturing facility in Gujarat could be instrumental in this effort, with the company indicating its ability to double its workforce within a year if further approvals are granted.

This landmark regulatory clearance not only unlocks new commercial possibilities for India’s nuclear energy sector but also strengthens the strategic energy partnership between the world’s two largest democracies.