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US Secretary of State Condoleezza Rice and visiting Indian External Affairs Minister Pranab Mukherjee signed the US-India Agreement for Cooperation Concerning Peaceful Uses of Nuclear Energy in Washington Friday.

An activist holds a placard to protest against India's civilian nuclear deal with the United States during a demonstration in Mumbai October 4, 2008.[Xinhua/Reuters Photo]

Under the agreement, American businesses will be allowed to sell nuclear fuel, technology and reactors to India, thus reversing a three-decade ban on atomic trade with the fast-growing nuclear-armed Asian power.

It was believed that the deal highlights a strategic partnership between the two countries not only in nuclear know-how but also in trade, defense cooperation and other areas.

"This is truly a historic occasion," Rice told those gathered for the signing ceremony in the State Department.

Mukherjee, who hailed the "important day for US-India relations," said that "We have brought to fruition three years of extraordinary effort by both our governments."

Mukherjee expressed belief that the India-US cooperation in the field of civilian nuclear program will boost India's industry and rural development and help every sector of the economic growth.

The nuclear pact could open up around 27 billion US dollars in investment in 18 to 20 nuclear plants in India over the next 15years, according to the Confederation of Indian Industry.

US President George W. Bush, who described the accord as the cornerstone of a new strategic relationship with India, signed into law on Wednesday a bill approved by Congress allowing civilian US nuclear trade with India, saying "It's a big deal" between the two countries.

"We are natural partners as we head into the 21st century," Bush said.

The United States imposed a ban on civilian nuclear trade with India after the latter's first nuclear test in 1974.

In July 2005, the Bush administration agreed to share civilian nuclear technology and supply nuclear fuel to India in return for New Delhi's separating its civilian and military nuclear programs.

The two countries reached an agreement on civil nuclear cooperation in March 2006, under which India will get access to US civil nuclear technology on condition that India is to separate nuclear facilities for civilian and military use and open its nuclear facilities for inspection.

Strategic, diplomatic and economic ties between India and the United States have blossomed after New Delhi was quick to back Washington's war on terror after the Sept. 11 attacks in 2001.

An activist takes part in a protest against India's civilian nuclear deal with the United States during a demonstration in Mumbai October 4, 2008.[Xinhua/Reuters Photo]

(Xinhua News Agency October 11, 2008)