Even as experts debate the economic feasibility of small modular reactors (SMRs), one of India’s leading nuclear plant equipment manufacturer, Larsen & Toubro (L&T), is confident the country can produce them at significantly lower costs than international players. “Off the cuff, I can say that India can produce SMRs at least 30 percent cheaper than global players,” said Anil V. Parab, Whole-Time Director and Senior Executive Vice President, L&T (Heavy Engineering).
Economic Viability Remains Under Scrutiny
The cost-effectiveness of SMRs has come under the spotlight following the enactment of the SHANTI Act, 2025, which allows private sector ownership and operation of nuclear power plants in India. Some experts, including former Atomic Energy Commission Chairman Dr. Anil Kakodkar, caution that the economic viability of SMRs remains uncertain until large-scale orders are secured.
Parab emphasized L&T’s six decades of experience in the nuclear sector and noted that SMR costs vary depending on design. “There are around 80 SMR designs globally, and international players are quoting prices ranging from ₹50 crore to ₹100 crore per MW,” he explained.
How India Stands on Pricing
India’s established Pressurised Heavy Water Reactors (PHWRs) currently cost around ₹15 crore per MW. While SMRs are inherently smaller and more complex, Parab estimates that India could manufacture them at approximately ₹30 crore per MW. He highlighted that large and small reactors share certain critical systems—such as control rods and boron injection mechanisms—spreading costs differently in SMRs.
Export Potential: Cautious Optimism
On the prospects of exporting SMRs, Parab remained measured. “There is enough to do in India,” he said, explaining that reactor exporters typically need to manage lifetime fuel supply arrangements. However, he noted that India’s PHWR technology is globally competitive, and rising international interest—especially from Asian countries—could create export opportunities.
He also suggested that the Department of Atomic Energy, which holds intellectual property for the Bharat Small Reactor, Bharat Small Modular Reactor, and High-Temperature Gas-cooled Reactor, could explore licensing the technology to foreign players.
Challenges in Financing and ‘Green’ Recognition
Parab pointed out that, despite opening the nuclear sector to private players, nuclear projects do not receive viability gap funding, unlike green hydrogen or electric vehicles. Additionally, GST on nuclear equipment is 18%, compared with 5% for other renewable energy technologies. Nuclear energy also lacks a formal ‘green’ classification, which limits access to green financing and incentives.
L&T May Explore Plant Ownership
When asked about owning nuclear plants, Parab said L&T is “keeping its options open.” While the company is primarily focused on engineering and construction, it sees strategic potential in co-locating power generation with data centres under its L&T Vyoma brand. As reported by thehindubusinessline.com, given the high energy demands of data centres and AI infrastructure, owning or operating nuclear plants could become a logical extension.
