India, Australia may sign nuclear pact

New Delhi: Australian Prime Minister Julia Gillard, whose bold move overturned a longstanding ban on uranium sale to India, comes here Oct 15 on a three-day visit that could see India and Australia sign a landmark civil nuclear pact.

Gillard’s visit takes place months after a reversal of Canberra’s long-standing policy by the ruling Labour Party on supply of uranium to India, paving the way for the sealing of a civil nuclear deal that could have a force-multiplier effect on broader ties both bilaterally and regionally.

The agreement on civil nuclear cooperation is likely to be signed during the visit, well-placed sources said.

The negotiations are, however, set to go down the wire as Australia will be insisting on a stringent uranium safeguards agreement and greater access to Indian nuclear facilities to inspect safe use of uranium supplied to India.

Australia will be looking to optimise the bargain as the leadership will have to sell the deal to the non-proliferation hawks who are firmly opposed to any uranium deal with a country which has not signed the Nuclear Non-Proliferation Treaty (NPT).

If the negotiations succeed, the India deal will be the first country-to-country agreement by Australia to sell the yellow cake to a country outside the ambit of the NPT.

A host of factors, including the state of cash-strapped Australian uranium mining industry, has, however, brightened the chances of such a nuclear pact.

With the global slowdown set to be prolonged, Australian uranium companies like Paladin, Toro and Energy Resources of Australia are pitching for the nuclear deal with India as it will bring them millions of dollars in business.

Australia has the world’s largest deposits of uranium, but it is only the third-largest supplier at about 7,000 tonnes per year due to high operational costs.

The India deal could, therefore, prove a godsend for uranium mining companies in Australia, especially as India, unfazed by scepticism about nuclear energy following the Fukushima disaster, is set to ramp up the share of atomic power in the country’s overall energy mix.

Intensifying trade and investment will be another key theme of Gillard’s India visit. The talks are expected to give a fresh thrust to negotiations on Comprehensive Economic Partnership Agreement which will provide greater market access to Indian exporters of goods and services.

Bilateral trade grew to $20 billion last year.

Besides nuclear deal and trade, an array of regional and global issues will also be on the table when Gillard holds talks with Prime Minister Manmohan Singh. Gillard will be seeking India’s support for her country’s bid for a non-permanent seat in the UN Security Council.

Amid competing ambitions of the US and China in the Asia-Pacific region, the two sides will be looking to ramp up their cooperation in the 16-nation East Asia summit which the leaders of the two countries will be attending in Cambodia in November.

Hard diplomacy apart, there will be a spot of soft power diplomacy as well, with the two countries launching a three-month long ‘Oz Fest’ during Gillard’s visit which is expected to create new cultural synergy in bilateral ties.