The United States and India said on Friday they made substantial progress in negotiations on a landmark nuclear cooperation agreement, and one U.S. official told Reuters the long-delayed deal was effectively done.

In a terse joint statement, U.S. and Indian negotiators said they are pleased with the substantial progress made on the outstanding issues but gave no details on how they bridged significant differences in talks extended two days longer than planned.

However, other officials said the agreement apparently turned on a compromise proposal proffered by India that would represent a special concession for New Delhi.

The two sides have been stalemated for months over the deal, which would give India access to U.S. nuclear fuel and reactors for the first time in 30 years.

We will now refer the issue to our governments for final review, said the joint statement, issued after four days of talks.

Both the United States and India look forward to the completion of these remaining steps and to the conclusion of this historic initiative, it added.

A U.S. official, speaking on condition of anonymity, told Reuters: There aren't any problems here.

While there needs to be final review work done in capitals ... we're fairly confident this is going to move forward and be completed in the next week or so, he said.

He said U.S. negotiators were also confident the deal would be acceptable to the U.S. Congress, which must approve it.

President George W. Bush, who considers the deal a major foreign policy success, has only 18 months left in office to get the agreement approved and implemented before a successor comes to power.

Congress strongly supports rapidly improving U.S.-India ties, but patience with what many see as India's unreasonable nuclear demands is waning.

Obstacles have included a U.S. congressional mandate that Washington halt nuclear cooperation if India tests a nuclear weapon, as it did in 1998.

Other disputed points have been the U.S. refusal to give India prior approval to allow reprocessing of spent fuel with U.S. components and assure permanent fuel supplies.


Aiming to prevent the diversion of nuclear material for weapons use, U.S. law and the nuclear Non-Proliferation Treaty bar such assistance to countries like India, which are not formally recognized as nuclear powers.

India has proposed averting the problem by constructing a new reprocessing facility that would be subject to inspection by U.N. monitors to guarantee that none of the nuclear material is used for weapons.

The two sides were considering this proposal, which if agreed to, would represent a special concession for New Delhi, better even than the U.S. reprocessing accord with Japan, U.S. officials and congressional sources told Reuters.

Japan is a U.S. treaty ally, a non-nuclear weapon state and an NPT signatory. India has not signed the NPT. It developed nuclear weapons in contravention of international standards and tested a nuclear device in 1998.

Daryl Kimball of the Arms Control Association, a leading critic of the nuclear deal, said it looks as though this dedicated reprocessing facility is the lynchpin to the agreement but it's a further U.S. capitulation to India.

He said the compromise puts the United States at risk of violating Article One of the NPT that prohibits indirect assistance to India's nuclear weapons program.

Congress last December passed the Hyde Act, which created a unique exception to U.S. export law to allow nuclear cooperation with India.

The current negotiations concern a separate agreement spelling out technical details of U.S.-Indian nuclear cooperation.