India and Russia sign deal for new nuclear plants

NEW DELHI (Reuters) - Russia President Dmitry Medvedev Friday signed agreements to develop new nuclear plants in India as the countries sought to deepen ties beyond their historic defense and weapon sales relationship.

The deal will allow Russia to build more reactors at the Kudankulam nuclear power plant in the southern Indian state of Tamil Nadu and plants in other parts of the country, the Indian government said in statement.

The deal comes after India signed earlier this year a nuclear pact with the United States, giving New Delhi access to civilian nuclear fuel and technology on the international market for the first time in three decades.

Overturning a U.S. ban on nuclear trade instituted after India first tested an atomic device in 1974, the U.S. pact provides India with access to nuclear fuel, reactors and technology to generate power for its 1.1 billion plus people.

"The signing of the agreement on civil nuclear cooperation with Russia marks a new milestone in the history of our cooperation with Russia in the field of nuclear energy," Prime Minister Manmohan Singh said at a news conference with Medvedev in New Delhi.

Russia is competing with the United States for influence in India, a Cold War ally of Moscow which the Kremlin sees as a growing partner in Asia.

"The cooperation in the energy sector remains a priority for us," Medvedev said. "We are very interested in developing cooperation in the nuclear sector. It is especially important now that various energy sectors are being developed."

But India, which wants to buy billions of dollars of weapons as it rearms, has been unhappy with holdups on major Russian arms contracts, including a delay to a $1.5 billion aircraft carrier modernization.

India, along with China, is one of Russia's biggest clients for arms sales.

(Reporting by Oleg Scchedrov; Editing by Alistair Scrutton and Sanjeev Miglani)