Proposed sales of Australian uranium to India are set to dominate Julia Gillard's visit to New Delhi.
Ms Gillard arrived in New Delhi last night at the start of a three-day visit which will include meetings with Indian prime minister Manmohan Singh and other senior ministers to discuss trade and cultural ties.
But sales of uranium to the nuclear-armed South Asian powerhouse are set to dominate the discussions.
Last year the Prime Minister convinced Labor to overturn a long standing policy that barred uranium exports to nuclear-armed India because it had not signed the Non-Proliferation Treaty.
Labor's about turn angered the Greens and sections of the ALP.
Audio: Gillard arrives in India for nuclear talks (AM) Ms Gillard insists India is a reliable country that will use the uranium in a responsible manner.
But Indian anti-nuclear activists are warning Australia not to get involved, claiming India's nuclear facilities are unsafe and one step away from disaster.
Should Australia export uranium to India? Share your thoughts with us below. "We know how to negotiate these agreements and we've done it in the past, and we've done it on the basis that Australian uranium is only used for peaceful purposes," Ms Gillard said.
"I formed the view as Prime Minister that it was appropriate for us to sell uranium to India, and that it had become an obstacle in our relationship that we were not."
Australia holds 40 per cent of the world's known uranium reserves, but a final deal to export Australian uranium to India could be years away.
India first tested a nuclear device back in 1974, and is estimated to have almost 100 nuclear weapons.
It also has significant civilian program, with 20 nuclear power stations currently supplying just under 4 per cent of the nation's electricity.
India currently has agreements with at least eight countries to supply its nuclear energy program and there are plans for many more reactors to be built to supply up to 10 per cent of the country's energy needs.
India only uses domestically-sourced material for its weapons program and the former head of the Australian Safeguards and Non-Proliferation office, John Carlson, says it would be unlikely India would funnel Australian uranium into its military activities.
"They have an independent military program which is clearly sufficient for their needs," he said.
"Now that India has taken the decision that it wants to import nuclear technology and nuclear material from around the world, it's clearly important for India to maintain security of supply for those materials.
"Therefore I think our starting assumption would be there would be no reason why they would violate agreements that would led to a stoppage of supply."
Audio: Alarm bells sound over Indian nuclear safety (AM) India has yet to have a serious accident at a nuclear plant but there are concerns about safety standards at its facilities and there is a growing anti-nuclear movement, with a number of people killed during a long running protest against the commissioning of a new reactor in Tamil Nadu.
PK Sundaram from the Coalition of Nuclear Disarmament and Peace says authorities are "handling democratic and peaceful protests in a most brutal and oppressive manner which is totally unacceptable in a civil society and a democratic country."
India's auditor-general has found gaping holes in the safety standards governing nuclear facilities, warning that India faces the possibility of a disaster along the lines of Chernobyl or Fukushima.
PK Sundaram is adamant Julia Gillard has made the wrong choice.
"We urge her to roll back this decision, to reconsider this decision," he said.
The head of Canadian uranium miner Cameco says a bilateral nuclear agreement with India will be key to building Australia's uranium industry.
Cameco does not yet produce uranium in Australia, but it owns a joint venture project to build a mine in the Pilbara region of Western Australia.
Cameco Australia managing director Brian Reilly has told Radio National that he believes Australia will be one of the world's top uranium producers.
"India represents a large market opportunity for any uranium fuel supplier, including Canada," he said.
"The main driver in our market, no surprise, is the demand coming from China, however India announced a program for construction of new nuclear power plants second only to China in its scale."
Since the ban on uranium sales to India was lifted last year, work has been under way to develop a safeguards treaty and put in place legislation that would enable sales to begin.
Ms Gillard is set to meet Mr Singh and Congress Party head Sonia Gandhi later in the week.
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