The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025, is a landmark and progressive legislation that came into force recently on December 21, 2025, repealing and replacing the Atomic Energy (AE) Act of 1962. It aims to modernise India’s nuclear energy sector by enabling limited private sector participation in certain activities, including research and intellectual property (IP) creation. The new law introduces significant reforms to the patentability of nuclear-related inventions, departing from the dated framework. The transition marks a fundamental shift from a restrictive regime (embargo on nuclear patents) under the AE Act to a liberalised regime (permitting nuclear patents for peaceful uses) under the SHANTI Act.
Under Section 20(1) of the 1962 Act, no patents could be granted for inventions related to atomic energy, including the production, control, use, disposal, prospecting, mining, extraction, enrichment, or use of any prescribed substances or radioactive substances. This prohibition, integrated into Section 4 of the Patents Act, 1970, discouraged private R&D and investment by denying IP protection, effectively limiting innovation to the Central Government. However, the new nuclear law removes these restrictions and also amends Section 4 of the Patents Act to give effect. Section 38(1) of the SHANTI Act (read with the amended Patents Act) allows patenting of inventions which are peaceful uses of nuclear energy and radiation, while excluding those that are related to activities exclusively reserved for the Central Government under Section 3(5) or sensitive in nature or having national security implications. The remainder of Section 38 provides the procedure for the grant of a nuclear patent.
Apart from the classical theory of incentives to invent, the legislative intent behind the inclusion-exclusion patentability principle under Section 38(1) reflects the core policy objectives of balancing the innovation-security trade-off and discerning the strategic-non-strategic innovation space. Private entities can now file and obtain patents for peaceful nuclear-related technologies and applications. The inventions relating to reserved activities will not be patentable, and these excluded activities consist of enrichment or isotopic separation of prescribed substances, management of spent fuel, production of heavy water and any other activities notified by the Central Government.
If a question arises as to whether an invention is related to reserved activities or is sensitive in nature or has national security implications, the Controller will refer the application to the Central Government (Department of Atomic Energy (DAE)) for seeking directions thereon. In case the invention does not relate to peaceful uses, the Central Government will issue directions to the Controller to refuse the application on that ground. This referral procedure is akin to the previous regime, except for the omission of administrative finality regarding the determination of patentability exclusion in the new law. However, Section 48 is indicative of a redressal mechanism in this regard wherein a review application can be filed before a statutory Council by any person aggrieved by an order or decision of the Central Government. In any event, the Controller’s refusal order based on adverse findings under Section 4 would be appealable as per the scheme of the Patents Act.
It is also noted that the enabling term “peaceful uses” is not defined or explained in the SHANTI Act, thereby being prone to subjective interpretation by the assessor. Moreover, in practice, the referral procedure and decision-making process appear to be less than satisfactory. The lack of opportunity for the patent applicant to defend its case before referring the matter to the DAE, the lack of reasoning in the DAE’s directions to the Controller, and the lack of reasoning in the Controller’s rejection orders are factors which may further multiply the legal uncertainty, thereby blurring the dividing line of patentability under Section 38(1).
The “saving and transition” clause engrafted under Section 91(2) of the SHANTI Act brings a silver lining for applicants of pending patent applications relating to peaceful nuclear applications. Any pending examination, referral, objections, hearings, or ongoing proceedings related to such patent applications under the old regime are deemed to continue under the new Act. Therefore, such applicants may file a request to prosecute the pending application under the new liberalised nuclear patent regime. The Indian Patent Office (IPO) and DAE will now process these pending applications/ referrals by applying the “peaceful use” yardstick. However, the transitional clause does not automatically revive or grant previously refused applications; it only ensures procedural and legal continuity.
As research is a precursor to patenting, the SHANTI Act also grants exemption of research, development and innovation activities from a licence if adequate safety and security are ensured. Section 9 enables any person to carry out research, development, design, and innovation in matters related to nuclear energy and radiation for peaceful use, except for activities exclusively reserved for the Central Government under Section 3(5) or those with national security implications.
In sum, the SHANTI Act recognises the commercial potential of nuclear energy in healthcare, agriculture, and power by deregulating R&D and innovation in nuclear science and technology and also by allowing private IP creation while safeguarding strategic interests. The new balanced nuclear patent regime encourages exploratory innovation, thereby promoting private-sector investment in nuclear energy applications, subject to governmental oversight of sensitive activities. However, casual referrals, mechanical assessments and non-speaking decisions may impede the examination and disposal of patent applications relating to the usage of nuclear energy. Therefore, the concerned bodies (IPO and DAE) are urged to devise standard operating procedures and guidelines for scrutiny and referral of such patent applications, thereby bringing legal certainty to stakeholders.
Authors: Manisha Singh and Neha Ruhela
First Published by: Mondaq here