Nuclear deal or early polls, India may learn soon

India’s government and its communist allies meet on Wednesday over a civilian nuclear deal with the United States, in talks that could decide if the controversial energy pact or the ruling coalition survives.The communists, who prop up the ruling coalition in parliament, say they will bring the government down if it pushes through the pact, a threat that last year saw Prime Minister Manmohan Singh’s coalition delay a showdown over a deal.

The government’s non-communist coalition members, worried that inflation at a 13-year high could destroy their re-election chances in a snap poll, are pushing Singh to avoid a political confrontation and delay the deal.

But Singh is reluctant to publicly abandon a deal in which he has invested a lot of his personal reputation, giving rise to media speculation that he is now ready to sacrifice the Congress-led government with less than a year before polls.

"There is no doubt that the meeting is extremely crucial and we expect the Congress to formally announce its decision," said communist leader Nilotpal Basu.

Singh says the pact is vital to end India’s long exclusion from global civilian nuclear trade, and Foreign Minister Pranab Mukherjee described it as the "most potent means" for achieving energy security for Asia’s third-largest economy.

The communists claim the deal, which gives India access to U.S. nuclear fuel and technology, would damage India’s independent foreign policy and security.

SNAP POLLS?

The Congress party has played down the political importance of the deal, saying it is one issue among many.

"The prime minister has categorically stated that nuclear deal is one important agenda, but the future of the government does not depend on the nuclear deal alone," Veerappa Moily, a senior Congress leader, said.

While time runs out, the deal still needs clearances from the International Atomic Energy Agency (IAEA) board of governors and the 45-nation Nuclear Suppliers Group.

Then the deal would have to go to the U.S. Congress for final approval. But it may already be getting too late as the United States gears up for presidential elections.

"The reality, of course, is that every day that goes by is one less day on the legislative calendar for us to be able to have congressional action take place," U.S. State Department spokesman Tom Casey said.

"So it certainly gets harder every day that this is delayed."

Some analysts say the communists could allow the government to negotiate an India-specific safeguards agreement with the IAEA, and not let the deal go any further.

That would buy the government time and avoid early elections but leave the deal in limbo.

Snap polls are a possibility if Singh resigns, analysts say, but his party could also find a caretaker prime minister if it wanted to see out its term in office.

"At the moment, it seems unlikely that the government will risk their electoral prospects, especially keeping in mind the inflation," Basu said.

"There are differences on the deal even within the Congress, so they are unlikely to push ahead."