US still hopes for India deal by 2008

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WASHINGTON, Oct 16 (Reuters) The United States today said that it was still hopeful of clinching a nuclear cooperation deal with India by the end of 2008 even though many experts predict the landmark agreement is all but dead.

State Department spokesman Tom Casey said the deal was in the best interests of both nations and despite ''internal discussions'' in India, he was optimistic it would go through before the end of the Bush administration in January 2009.

''We do hope though that India will decide to move forward with this agreement and we would like to see it completed in 2008. This is an issue on which we continue to have conversations with Indian government officials,'' Casey told reporters.

The deal, which aims to give India access to much-needed but long-denied US nuclear fuel and reactors, has pushed Indian Prime Minister Manmohan Singh's fragile coalition close to collapse after its communist allies rejected the agreement.

The communists have argued the deal would make India subservient to US interests.

White House spokesman Tony Fratto strongly rejected the view of many experts that the deal is collapsing.

''We understand that all politics are local and that India is a thriving democracy and they have work to do and they may need some additional time on their end to get their part of this deal done,'' Fratto told reporters.

''The president is willing, and is very understanding that the Indians may need more time for this. But no, it's not dead,'' he added.

FACING THE POLITICAL CLOCK But Daryl Kimball, executive director of the Arms Control Association in Washington, disagreed.

''If it's not dead, it's definitely in the hospital and it's going to have a long road to recovery,'' said Kimball in an interview with Reuters TV.

All agree that both sides are hemmed in by the political clock.

President George W Bush has about 15 months left in office and if debate drags on well into next year, the political focus will be on the 2008 presidential and congressional elections rather than on getting an India deal through.

Bush spoke to Singh yesterday about the deal. Last week, Singh said it would be a disappointment if the deal did not go ahead but life would go on. His government, he said, did not want an early election.

Rep. Howard Berman, a California Democrat and author of an amendment to tighten the agreement, said a new administration would be much more energetic in promoting a non-proliferation agenda.

''I would hope in this period time, if in fact that things are delayed, we would get a resolution of some ambiguities in the interpretation of the 123 agreement,'' he said.

Experts predict that a Democrat in the White House is less likely to push the deal through in its current shape after the 2008 elections.

For the deal to ultimately go through, India still needs clearance from the UN's nuclear watchdog and final approval from the US Congress.

REUTERS KD RAI2253

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