VIENNA, Austria —  The global body that governs the legal trade in nuclear materials postponed a decision Friday on whether to give New Delhi access to nuclear fuel and technology _ a blow to a landmark deal between Washington and New Delhi.

The Nuclear Suppliers Group's approval of an exemption to its rules is essential for finalizing the civil nuclear cooperation deal. The pact would reverse more than three decades of U.S. policy by allowing the sale of nuclear materials to India, a country that has not signed international nonproliferation accords _ and has tested nuclear weapons.

The 45-nation suppliers group said in a statement Friday that it will meet again soon to continue its deliberations on an agreement.

Earlier this month, India fulfilled one prerequisite for the deal by striking an inspections agreement with the International Atomic Energy Agency. After the NSG agrees to waive its rules for India, the deal would need approval by the U.S. Congress.

Suppliers group approval would enable other countries to strike similar deals with India.

Washington, eager to see the deal pushed through before President George W. Bush leaves office, played down the inconclusive end to the two-day gathering.

"We had a constructive and positive discussion today," acting U.S. Undersecretary of State John Rood told reporters.

"For us in the United States, we're pleased with the results of the discussion and I remain very optimistic that we're going to continue to make progress toward this important goal."

Observers had predicted it could take multiple meetings before a decision is taken.

Delegates leaving the closed-door meeting Friday gave little indication of what went on but it was clear that U.S. and Indian hopes for an unconditional exemption had suffered a significant setback.

Indian Foreign Secretary Shivshankar Menon declined to comment to international journalists.

One participant told The Associated Press that the U.S. was expected to present a revised waiver proposal by the beginning of next week.

"We had expected them to have a new draft ready today but apparently there were so many amendments and problems that they didn't get it done in time," said the participant, who requested anonymity because of the sensitivity of the matter.

The next meeting is expected to take place in Vienna on Sept. 4 and 5, participants said.

All participants spoke on condition of anonymity because they were not allowed to speak to the media.

Some countries are eager to do more business with India, and appear to back a U.S. argument that the deal would bring India into the nonproliferation mainstream.

But other countries are concerned that exporting nuclear fuel and technology to a country that has not made a legally binding disarmament pledge could set a dangerous precedent.

Daryl Kimball of the Washington-based Arms Control Association said, the group was relieved that "a number of NSG states are insisting on common sense restrictions and conditions on nuclear trade with India to reduce the risk that such trade will assist India's nuclear bomb program and hold India accountable to its political commitment not to resume testing."

As discussions continue, it is vital that states make clear that nuclear trade with India would be terminated if it resumes testing nuclear weapons for any reason, Kimball said.

On the Net:

Nuclear Suppliers Group: http://www.nuclearsuppliersgroup.org/

Arms Control Association: http://www.armscontrol.org/

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