The center-left Labour Party government came to power in 2007 and immediately ended Australia’s negotiations with India on starting nuclear trade because India has not signed the Nuclear Nonproliferation Treaty.

Gillard said she wants Labor to change its policy at its annual national conference next month because the United States lifted a “de facto international ban” on nuclear cooperation with India in 2005 by signing a bilateral deal with New Delhi to trade uranium and work together on civil atomic power generation.

“Given that change in diplomatic circumstances around the world, for us to refuse to budge is all pain and no gain, and I believe our national platform should recognize that reality,” Gillard told reporters.

But a policy change would not lead to uranium sales to India’s nuclear rival Pakistan or Middle Eastern nuclear power Israel.

“When you look at other nations ... whether it be Pakistan or Israel, they are not in the same class,” she said.

India welcomed Gillard’s decision.

“We attach importance to our relations with Australia, which are growing across the board. Energy is one of the key areas of bilateral cooperation,” Indian External Affairs Minister S. M. Krishna said.

“We understand that Prime Minister Gillard proposes to seek a change in the Australian Labour Party’s policy on sale of uranium to India, in recognition of our growing energy needs, our impeccable nonproliferation record and the strategic partnership between our two countries. We welcome this initiative,” he said.

Gillard said the trade with India should comply with International Atomic Energy Agency conditions and carry strong bilateral undertakings that the uranium will be only used for peaceful purposes.

Her stance has been met by opposition within her party and from the environmental Greens party, whose support is crucial to the minority government maintaining power.

But Sen. Doug Cameron, leader of a Labor faction opposed to the policy reversal, conceded that he did not have sufficient numbers to maintain the status quo at the party conference.

Greens leader Sen. Bob Brown warned that selling uranium to India would add to a “nuclear arms race.”

Australia, which holds 40 percent of the world’s known uranium reserves, does not sell uranium on the open market and bans nuclear power generation at home.