India, Japan seek early agreement on civil nuclear pact

TOKYO (REUTERS) - Japanese Prime Minister Shinzo Abe and his Indian counterpart agreed on Wednesday to speed up talks on a deal to allow Japan to export nuclear plants and to strengthen security cooperation as both sides keep a wary eye on China's military clout.

The Indo-Japanese summit meeting follows Chinese Premier Li Keqiang's visit last week to India, which has been shaken by a recent border spat with China and is cautious about Beijing's friendship with rival Pakistan.

Japan, for its part, has been locked in a territorial dispute with China over a group of East China Sea islets.

"In the political and security area, maritime security cooperation will further be strengthened ... On civil nuclear cooperation, negotiation will be accelerated toward the early conclusion of the agreement," PM Abe told a ceremony alongside Indian PM Manmohan Singh.

Unable to rely on a coal sector crippled by supply shortages and mired in scandals, India is pushing ahead with constructing nuclear reactors despite global jitters over safety. Hundreds of millions of Indians still live without power and factories suffer frequent blackouts.

A civil nuclear energy pact with India would give Japanese nuclear technology firms such as Toshiba Corp and Hitachi Ltd access to India's fast-growing market when they search for opportunities overseas to offset an anti-nuclear backlash at home in response to the Fukushima radiation crisis.

India operates 20 mostly small reactors at six sites with a capacity of 4,780MW, or 2 per cent of its total power capacity, according to the Nuclear Power Corporation of India Limited. New Delhi hopes to lift its nuclear capacity to 63,000MW by 2032 by adding nearly 30 reactors.

PM Abe and PM Singh welcomed expanding defence cooperation and decided to hold regular joint naval exercises. The first such exercise was held last June.

Faced with China's maritime expansion, Dr Singh and Mr Abe said they were committed to freedom of navigation and unimpeded commerce, and agreed to promote cooperation on maritime issues.

In a separate move, Japan agreed to extend up to 71 billion yen (S$880 million) in official development assistance for an subway project in Mumbai, India's financial capital.

"Our discussions were guided by the fundamental belief that at the time of global uncertainties, change and challenges, India and Japan are natural and indispensable partners," Dr Singh said.

"We attach particular importance to intensifying political dialogue and strategic consultation and progressively strengthening defence relations."

India has often been nervous about Chinese agreements with its neighbours that are not strictly military but could be leveraged in a conflict.

Indians sometimes refer to these as a "string of pearls", which include China's ties with Pakistan, access to a Myanmar naval base, Chinese construction of a deepwater port in Sri Lanka, and its deepening ties with Nepal and the Maldives.

India and Japan also agreed to strengthen cooperation in renewable energy, energy conservation, clean coal technologies and liquefied natural gas.

Dr Singh expressed interest in working with Japan in extraction of natural gas from undersea methane hydrate deposits.

State-run Japan Oil, Gas and Metals National Corp said in March it extracted gas from offshore methane hydrate deposits for the first time in the world, as part of an attempt to achieve commercial production within six years.

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