New Delhi, March 25 :

India is readying for some tough negotiations with the US when the two begin a crucial round of talks Monday on finalising the contours of the bilateral civil nuclear agreement that will govern future nuclear trade between the two countries.

Critical issues like nuclear testing and the production of fissile materials, the re-processing of spent fuel and the nature of India’s safeguards agreement with the International Atomic Energy Agency (IAEA) will dominate discussions between the two sides.

The two sides will build on convergences and concentrate on finalising a large part of the text of the 123 agreement - named after Section 123 of the Atomic Energy Act - that will have to be approved by an up and down vote by both chambers of the US Congress before it becomes operational.

A US team led by Richard Stratford, director of Nuclear Energy, Safety and Security in the State Department, will hold talks with the Indian delegation led by Gayatri Kumar, joint secretary (Americas) in the external affairs ministry.

The Indian team will also compromise senior officials of the department of atomic energy.

This will be the first technical round of talks since the US Congress passed the Hyde Act enabling full civilian nuclear cooperation with India last December.

The 123 agreement, which will be the sole legal document that that will govern the terms of civil nuclear commerce between India and the US, will be crucial in influencing the 45-nation Nuclear Suppliers Group to amend its guidelines in favour of global nuclear trade with India.

As the two sides begin talks Monday, India will remind the US about the “full civilian nuclear cooperation” it was promised in the July 18, 2005, civil nuclear deal in return for placing civilian nuclear reactors under international safeguards, but which has been restricted by the Hyde Act.

The US legislation excludes the sale of equipment related to enrichment, reprocessing and heavy water production to India. India will make a strong pitch for being granted prior consent to re-process spent fuel that the US legislation denies.

The US has so far granted reprocessing rights with prior consent to only three countries - Japan, Switzerland and the European Union.

The US is pushing hard to convert a voluntary moratorium by India on nuclear testing and the production of fissile material into a permanent binding one - a condition that is not acceptable to New Delhi as enunciated by Prime Minister Manmohan Singh in parliament in debates on the nuclear deal.

The US also wants to include a condition in the 123 agreement that entails the US terminating nuclear cooperation with India in case it conducts a nuclear weapon test, a situation that will require New Delhi to return all nuclear equipment and fuel given to it by Washington.

Ahead of the talks, the US has struck an optimistic note saying “there is pretty good understanding of things that we have to deal with, and even some understandings on how we might move forward”.

The US was not too happy with the first draft submitted by Foreign Secretary Shivshankar Menon to US Under Secretary of State for Political Affairs Nicholas Burns when the former visited Washington last month.

But since then, the two officials have been engaged in discussions and there is a likelihood that a large part of the text will be finalised at the end of the talks later this week.