Indian PM calls for vote of confidence

By Alistair Scrutton

NEW DELHI (Reuters) - Indian Prime Minister Manmohan Singh on Thursday sought a vote of confidence in his government after his communist allies withdrew their support in protest against a nuclear deal with the United States.

The date of the parliamentary vote will be announced on Friday. Singh met President Pratibha Patil after the government's former communist allies had demanded the vote.

"Dr. Manmohan Singh called on the president today," said a statement from the president's office. "He stated that he and his cabinet colleagues are keen to seek a vote of confidence as early as possible."

Singh's four-year-old government has secured the backing of the regional Samajwadi Party, but it is unclear if the ruling coalition has enough votes for a parliamentary majority.

A defeat for the government in a confidence vote would trigger an early election, probably destroying chances of the nuclear pact going ahead and sparking political uncertainty as the country struggles with record inflation and rising interest rates.

The government needs several votes from other smaller parties and must hope there is no rebellion within the ranks of the Samajwadi Party against the nuclear deal, which critics say gives the United States too much influence over India.

India's 543-member house includes scores of small parties from dozens of ethnic groups and castes, making it unclear whether the government has the necessary support.

Indian markets were hit last week by the uncertainty but have since welcomed the communists' exit. Signs of stability helped prevent sharp losses in the Indian rupee on Thursday.

The nuclear pact's approval would be a victory for Singh, giving India access to U.S. resources and technology and moving the Asian giant's trade and diplomatic relations closer to the West as it seeks fuel sources for a booming, trillion-dollar economy.

India has submitted a draft plan to the International Atomic Energy Agency (IAEA) detailing how India's civilian nuclear facilities would be monitored internationally, a crucial step to finalizing a deal first agreed in 2005 between Singh and U.S. President George W. Bush.

The IAEA board of governors is expected to meet later this month to consider India's nuclear document.

LOOPHOLES

Critics say the deal reverses 30 years of U.S. policy opposing nuclear cooperation with India after it developed nuclear weapons.

Some critics also see loopholes in the draft agreement, citing a clause suggesting India could cancel the deal if foreign fuel supplies were cut off in response to an act such as a nuclear bomb test by India.

IAEA inspectors and legal experts who hammered out the pact with India deem it consistent with global safeguards standards and have recommended that the 35-nation IAEA board approve it, making it likely it will pass without serious opposition.