The United States and India have concluded two years of negotiations on a long-delayed landmark civilian nuclear agreement.
Several key sticking points held up finalization of the deal, which still must be approved by the U.S. Congress, the Indian parliament and the International Atomic Energy Agency.
In final talks with U.S. officials, India won the highly controversial right to continue testing nuclear weapons and to reprocess spent fuel - two issues the U.S. had previously refused to agree to.
Under Secretary of State for Political Affairs Nicholas Burns told reporters the United States agreed to give India long-term permission to reprocess nuclear material because New Delhi has committed to building a new reprocessing facility that would only use such material.
Burns also said U.S. officials emphasized the agreement is only about civilian -- and not strategic - nuclear cooperation.
In New Delhi, national security adviser M.K. Narayanan dismissed the idea that the deal represents a chance for India to boost its nuclear weapons arsenal.
Under the agreement, energy-hungry India will have access to U.S. nuclear fuel and equipment for the first time in 30 years - even though New Delhi has not signed the nuclear Non-Proliferation Treaty.
For its part, India has agreed to open its civilian nuclear reactors to international inspectors.
President Bush hailed the conclusion of the talks, saying he will work with the U.S. Congress on the initiative. In a written statement, Secretary of State Condoleezza Rice called the deal "an historic milestone" with many benefits, including new sources of energy and improved methods of non-proliferation.