(AFP) – Jul 23, 2008
NEW DELH (AFP) — India's government Wednesday celebrated a victory it said would help bring millions out of poverty, after winning a vote that clears the way for a controversial nuclear deal with the United States.
After two days of often chaotic debate , the Congress-led coalition of Prime Minister Manmohan Singh late Tuesday survived a confidence vote in parliament, beating a challenge from the mainly left-wing and Hindu nationalist opposition.
Singh needed just a simple majority to keep his vision of modernising India intact and see through the last year of his mandate.
Had he failed, the world's largest democracy would have headed into early elections, with his opponents emboldened.
"This government has an absolute majority and this is a vote of confidence to go forward," Finance Minister P Chidambaram said, as Congress supporters held noisy late-night celebrations.
"Now we have crossed a major bridge that is the Indo-US civilian nuclear deal. Now, we will move ahead on economic and social reforms."
Indian shares rose 4.4 percent in morning trade Wednesday on the news.
"The win has opened a small window. If oil prices remain lower and the coalition takes steps to initiate pending reforms, the markets could see follow-up buying," said Andrew Holland, head of strategic risk group, DSP Merrill Lynch.
Singh said the nuclear deal will allow energy-hungry India to "operate on the frontiers of modern science" by pulling it out of three decades of international sanctions blocking its access to nuclear fuel.
The agreement, unveiled in 2005, will allow the United States to sell nuclear plants and related technology to India once it has separated its civil and military programmes and accepted a certain level of UN inspections.
Supplies of nuclear fuel and modern technology could bring some relief for India, blighted by dilapidated infrastructure.
The national grid cannot keep pace with increased ownership of air conditioners, and power cuts are frequent -- with businesses large and small forced to shell out large amounts of money for back-up solutions.
The prime minister argued this has been holding the country back from reaching the kind of double-digit growth needed to lift hundreds of millions of people out of "chronic poverty, ignorance and disease."
"A basic requirement for achieving this order of growth is the availability of energy," said Singh, whose government is struggling to bring inflation down and sustain heavy fuel subsidies in the face of soaring crude prices.
The nuclear deal was submitted earlier this month to the UN's International Atomic Energy Agency for approval, and is expected to be passed by its 35-member board in the coming weeks.
India must also get approval from the 45-member Nuclear Suppliers Group that regulates nuclear fuel and technology trade, and finally from the US Congress.
Washington has urged India to move fast before November elections.
"There aren't that many days left where Congress is going to be in session," White House spokeswoman Dana Perino cautioned, adding that enough US lawmakers backed the agreement to secure its ratification.
The US Chamber of Commerce says the pact could give American firms up to 100 billion dollars of business. Russia and France are also lining up to sign similar cooperation deals with India.
India's left-wing and communists, who sparked the confidence vote by withdrawing their support for the government over the pact, had argued it was trading New Delhi's cherished neutrality for a subservient relationship with Washington.
Along with the main opposition Hindu nationalist Bharatiya Janata Party (BJP), they said international inspections would also harm the development of India's nuclear weapons programme.
In a last-ditch attempt to bring down the government, three BJP lawmakers waved bundles of cash worth 30 million rupees (715,000 dollars) that they said they had been paid for their votes.
Officials in parliament said speaker Somnath Chatterjee had called in New Delhi's police chief to investigate the bribery claims. Chatterjee said the corruption furore meant it was a "sad day in the history of parliament."
According to the Business Standard newspaper , "Tuesday turned out to be one of the blackest days in the history of India's parliament."
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