Nuclear power continues to gain momentum worldwide, with India and Saudi Arabia each advancing plans this week to expand their presence in the sector. Separately, the Sprott Physical Uranium Trust (TSX: U.U for USD; U.UN for CAD) purchased 50,000 lb. of uranium oxide as the spot price edged higher.

India Allocates $2 Billion for SMR Development

India is earmarking approximately $2 billion to construct at least five small modular reactors (SMRs) by 2033, Atomic Energy Minister Jitendra Singh announced Wednesday, according to India's Economic Times. The initiative forms part of a broader strategy to expand the country's nuclear power capacity 11-fold, reaching 100 gigawatts (GW) by 2047, up from the current 8.8 GW. The 2047 target year coincides with the centenary of India's independence and aligns with the country's commitment to achieve net-zero emissions by 2070, placing nuclear power at the centre of a long-term decarbonisation strategy for the world's most populous nation.

Three SMR designs are under development by the Mumbai-based Bhabha Atomic Research Centre, Singh said. These include reactors with 220-megawatt and 55-MW capacity, as well as a gas-cooled reactor producing less than 5 MW that would serve as a heat source for hydrogen production. SMR technology remains pre-commercial globally, with only a handful of prototype units operating and no large-scale fleet deployment yet achieved, meaning India's plan would place it among the early movers if the 2033 construction timeline holds.

The SMR announcement follows a statement from India's state-owned NTPC just over a week prior, in which the company indicated it is exploring financing for overseas uranium mines to secure fuel for its nuclear expansion. Although India possesses domestic uranium reserves, they are reported to be of only medium tonnage and low grade, making external supply agreements critical to the expansion plan.

As part of its nuclear push, India signed a $1.9-billion supply deal with Cameco (TSX: CCO; NYSE: CCJ) in March for uranium ore concentrate. In February, Kazatomprom (LSE: KAP), the world's largest uranium producer, agreed to sell a substantial portion of its output to India. India's access to international uranium markets was facilitated by a 2008 civil nuclear cooperation agreement with the United States, which opened the door to nuclear trade despite India not being a signatory to the Nuclear Non-Proliferation Treaty.

A growing number of countries are pursuing nuclear energy as an alternative to fossil fuel-based power generation, driven by the need to supply electricity to expanding economies and energy-intensive AI data centres.

The uranium spot price rose 10¢ to reach $85.70 per lb. on Wednesday, extending a months-long period of stability following a volatile first quarter in which the price briefly surpassed $100 per pound.

US-Saudi Nuclear Cooperation Agreements

Saudi Arabia and the United States signed agreements this week that could lay the groundwork for a Saudi civilian nuclear power program. According to BMO Capital Markets, the deals could also enable the kingdom to construct standard AP1000 commercial nuclear reactors, a Westinghouse-designed pressurized water reactor already in commercial operation at Plant Vogtle in the US state of Georgia and at multiple sites in China.

"These agreements reflect our two nations' shared commitment to strengthening U.S.-Saudi commercial relations, delivering prosperity at home and security to our allies abroad," US Energy Secretary Chris Wright said in a Department of Energy release. "These agreements uphold the highest standards of nuclear safety and non-proliferation, while relying on the world's best nuclear technology and scientists, designed right here in the United States."

The nuclear cooperation agreement is intended to provide American companies access to Saudi Arabia's nuclear energy program, the DOE said. Saudi Arabia has been exploring nuclear power for over a decade as part of Vision 2030, its economic diversification strategy aimed at reducing dependence on oil revenue, and has previously held discussions with nuclear suppliers including Russia and South Korea.

According to the International Atomic Energy Agency, the United Arab Emirates and Iran are the only Middle Eastern countries currently operating nuclear power plants. Nuclear reactors are also under construction in Egypt and Turkey.

Sprott Continues Uranium Acquisitions

Sprott's 50,000-lb. purchase of uranium oxide (U₃O₈) on Wednesday brings the trust's total holdings to 81.5 million lb., BMO noted, capping a year of sustained acquisitions by the physical uranium fund. In February, the trust purchased 250,000 lb. of U₃O₈ — its largest single acquisition since the fund's inception in 2021. The trust's steady accumulation reflects the tightening supply-demand balance in the uranium market as state-backed nuclear expansion programmes in Asia and the Middle East add demand to a sector that saw years of underinvestment following the 2011 Fukushima accident.