Will India Sign a Nuclear Deal with US before 31 July 2008

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Singh Seeks Support for India Nuclear Deal After Surviving Vote

By Cherian Thomas and Bibhudatta Pradhan
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July 23 (Bloomberg) -- Indian Prime Minister Manmohan Singh will revive his push to import nuclear reactors and fuel next week with support from President George W. Bush after his government survived a confidence vote in parliament.

Singh's Congress Party-led coalition won enough votes to extend its four-year term after a two-day debate on the U.S. nuclear accord marred by allegations of bribery and intimidation. The U.S. will urge other board members of the International Atomic Energy Agency to support an inspection plan tied to the accord during a meeting on Aug. 1, State Department spokesman Gonzalo Gallegos said in Washington.

``The government will press on the accelerator regarding the nuclear deal,'' said N. Bhaskara Rao, chairman of the Center for Media Studies, a political policy group in New Delhi. ``Singh will also attempt to move ahead on other economic reforms.''

The 2005 accord signed between Singh and Bush gives India access to fuel and nuclear reactors without joining the 1970 Nuclear Non-Proliferation Treaty. It would lift restrictions imposed on suppliers to provide India with atomic technologies since it tested a nuclear weapon in 1974 without being listed as an atomic weapons state.

India can now seek the nuclear deal's approval from the IAEA and the Nuclear Suppliers Group, a mandatory requirement before the U.S. Congress can ratify it. White House spokeswoman Dana Perino predicted approval in Congress should the plans succeed with the IAEA and the 45-nation suppliers group.

Legislative Calendar

``We're certainly mindful of the legislative calendar,'' Perino told reporters at the White House before the final tally in India. ``But we think that there's enough support in Congress that we would be able to get this done, should we be able to bring it to Congress for a vote.''

In the Nuclear Suppliers Group, the U.S., U.K., France, Russia, Japan, China, and most recently Australia have voiced support for giving India the necessary exemptions it needs to conduct trade in nuclear material and equipment with the member countries, the U.S.-India Business Council said.

``Time is tight in that the U.S. congressional calendar is jam-packed between now and the U.S. presidential election'' in November, Ron Somers, president of the business council, said in a statement after the Indian vote.

Singh had to demonstrate his strength in parliament after his communist allies withdrew support on concern the accord will weaken the nation's foreign policy. Singh won 275 votes in his favor and 256 against in the confidence motion late yesterday.

``Parliament has spoken in an unambiguous manner,'' Singh said after the vote. ``This augurs well for the country's development and for India's efforts to find its rightful place in the comity of nations. It is a convincing victory.''

Stocks Rise

Indian stocks rose in U.S. trading after the government's victory. ICICI Bank Ltd., India's second biggest, climbed 13 percent to $33.89. HDFC Bank Ltd., the third-largest, soared 9.8 percent to $85.97.

The two-day debate was repeatedly adjourned as lawmakers cutting across party lines shouted down the speakers and hurled allegations.

Parliamentarians from the Bahujan Samaj Party alleged that an emissary from the government threatened them with the prosecution of their leader, Mayawati, chief minister of Uttar Pradesh, unless they supported the motion.

The main opposition Bharatiya Janata Party lawmakers displayed purported bundles of currency notes in parliament, which they said were offered to their lawmakers in return for support to the government.

Indian Concerns

Bharatiya Janata Party leader Lal Krishna Advani had pledged to renegotiate the nuclear energy accord if it came to power, because the deal makes India ``subservient'' to the U.S.

Singh says the accord will help increase nuclear generation 10-fold and end blackouts in the world's second-most populous country, after China. Shortage of power and other infrastructure shaves 2 percentage points from India's annual economic growth, the finance ministry estimates. India needs to bridge that deficit to sustain growth of more than 10 percent and ease poverty.

The Bush administration bills the overall agreement as a way to help India meet its energy needs, bolster non-proliferation controls and strengthen U.S. relations with the Asian subcontinent.

``We continue, obviously, to support this,'' Gallegos told reporters in Washington after the final vote in New Delhi. ``We're going to be working with our folks here in the United States to move forward with it.''

To contact the reporters on this story: Cherian Thomas in New Delhi at cthomas1@bloomberg.net; Bibhudatta Pradhan in New Delhi at bpradhan@bloomberg.net
Last Updated: July 22, 2008 16:47 EDT