'Best days ahead'

Prime Minister Julia Gillard and her Indian counterpart Manmohan Singh announced the start of civil nuclear negotiations, which would remove the last hurdle in their bilateral relationship and towards sealing a nuclear deal.

Despite resistance from nuclear non-proliferation advocates, the Australian premier and her Labor Party have been the prime movers behind the ongoing Indo-Australian nuclear rapprochement in order to build a healthy and strategic bilateral partnership.

In December last year, the Labor Party reversed an earlier policy of not selling uranium to countries which have not signed the Nuclear Non-Proliferation Treaty (NPT). India refuses to sign the NPT maintaining it discriminates against countries that carried out tests after the treaty came into force in 1970. Its constant refrain is that it safely guards its nuclear technology and secrets.

"We have changed our party policy so that there is now no fetter for us on selling uranium to India," Gillard told the media on the first day of her maiden visit to India as prime minister. "The thing that would have to happen next is the negotiation of a comprehensive civil nuclear cooperation agreement."

One to two years

Gillard also pointed out that she expected discussions on uranium sales to India to last one to two years.

"The potential exports of uranium to India are likely to be small when it happens," Happymon Jacob from Jawaharlal Nehru University in New Delhi told DW. "But it is encouraging nevertheless. Right now, Australia exports about almost one billion dollars worth of uranium annually to the US, Europe, Japan, China and other countries."

Australia has 40 percent of the world's known uranium reserves and the announcement will eventually open the door for uranium exports to India to ensure enough fuel for its civil nuclear program.

In 2008, Washington signed a landmark civil nuclear agreement with India over the use of uranium for nuclear energy.

Greater economic, political and strategic cooperation

Analysts pointed out that Gillard's trip was not only about nuclear cooperation but primarily to promote her country's rising interest in India and seek greater economic, political and strategic links.

During her trip, India and Australia have added more economic muscle to their mushrooming relationship and said they will strive to accelerate their negotiations for a comprehensive economic partnership agreement.

Next month, the countries will launch the next round of the Comprehensive Economic Cooperation Agreement negotiations that are expected to result in enhanced economic integration.

In her keynote speech, Gillard also pointed out that the two countries had shared strategic interests. "In a century of growth and change, our interests are closer than they have ever been. We share a region of the world and we share an ocean," she said.

Bilateral trade in goods has grown rapidly and stood at $US 17.4 billion in 2011 to 12. Australia has set a goal of more than doubling trade with India to $US 40 billion by 2015 and the two countries are also working on a free-trade agreement.

Australian High Commissioner to India Peter Varghese, who is due to take over as the secretary of the Department of Foreign Affairs and Trade in Canberra next month, told DW there was enormous room for growth in this relationship.

"I think the exciting thing about it is that our interests are converging and when your interests converge, you have more room to work with. So we have certainly not reached the end of what we can achieve, far from it. I think our best days are ahead," he said.