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UPDATE 1-Russia, India sign $700 mln in nuclear fuel deals

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MOSCOW, Feb 11 (Reuters) - Russia signed more than $700 million in deals on Wednesday to supply India’s nuclear reactors with fuel pellets, Russia’s state-owned nuclear company said in a statement.

Major nuclear powers -- including Russia, European states and the United Sates -- are scrambling to sell nuclear services to India, which is trying to build new generation capacity to cope with a projected increase in demand for energy.

Atomenergoprom said its nuclear fuel unit, TVEL, and Indian nuclear officials signed the deals in Mumbai on Wednesday.

“The total cost of contracts is more than $700 million,” it said, adding it was the first long-term nuclear fuel contract signed with India since the 45-nation Nuclear Suppliers Group last September lifted a ban on nuclear trade with India.

The ban was imposed after India’s first nuclear test in 1974 and for its refusal to join the Non-Proliferation Treaty (NPT).

Russia is building nuclear reactors at the Kudankulam nuclear power plant in the southern Indian state of Tamil Nadu and plans to build plants in other parts of the country.

Russia sees India, a Cold War ally, as an important partner whose influence will expand in Asia, though Moscow and New Delhi have bickered over delays to the delivery of Russian arms.

Russia wants to double trade with India to $10 billion by 2010 to cement relations, but trade with India lags far behind Moscow’s economic ties with the European Union and China.

Russia is building two 1,000 megawatt reactors at Kudankulam as part of a deal signed in 1988. Russia agreed in 2008 that it intended to build four more reactors at the site.

Russian nuclear reactors cost up to $2 billion a piece but India would be expected to get a hefty discount on such a major deal, which cements Russia’s nuclear cooperation. (Reporting by Guy Faulconbridge, editing by Christian Lowe)