Australian PM Julia Gillard is holding talks with Indian counterpart Manmohan Singh on the sale of uranium to India for its nuclear power programme.
Last December Ms Gillard’s ruling Labor party overturned its long-standing ban on exporting uranium to India.
Australia, which holds an estimated 40% of the world’s uranium, already exports it to China, Japan, Taiwan and the US.
The country does not sell uranium to India because it is not a signatory to the Nuclear Non-Proliferation Treaty.
Ms Gillard has said she expects discussions on uranium sales to India to last one to two years, reports say.
“We have changed our party policy so that there is now no fetter for us on selling uranium to India,” Ms Gillard told reporters on Tuesday, mid-way through her three-day visit.
“The thing that would have to happen next is the negotiation of a comprehensive civil nuclear co-operation agreement.”
Ms Gillard is also expected to hold meetings with Indian President Pranab Mukherjee and senior government ministers in Delhi on Wednesday.
The Australian prime minister’s visit is aimed at boosting economic ties between the two countries – bilateral trade is worth $20bn (£12.5bn) and is growing at the rate of 20% every year.
On Tuesday, Ms Gillard announced that Indian cricket star Sachin Tendulkar will be awarded the Order of Australia, one of the country’s highest honours.
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