Page last updated at 06:50 GMT, Thursday, 3 April 2008 07:50 UK

India and Burma in transport deal

Indian PM Manmohan Singh and General Maung Aye
India is keen to boost economic ties with Burma

India and Burma have signed a major transport agreement linking a Burmese port with part of north-east India via road and river connections.

The $120m project will allow India to develop Burma's Sittwe port on Kaladan river from where goods will be ferried.

India has gone ahead with the project despite international pressure to isolate Burma for its rights record.

Delhi wants to boost economic ties with Burma despite urging dialogue between the Burmese government and opposition.

The agreement was signed between the second most powerful figure in the Burmese government General Maung Aye and vice president of India Hamid Ansari.

Burma awarded India the right to "build, operate and use" the port of Sittwe, strategically located in the Bay of Bengal.

When India begins using the Sittwe port, it would help make Burma's Kaladan river navigable all the way up to neighbouring India's north-eastern Mizoram state.

This would, in turn, lead to India upgrading highways connecting Mizoram with the rest of the country to boost trade.

Both sides also agreed to take steps to open up existing border points in India's north-eastern states for regular trade.

India has been cultivating the Burmese military junta for more than a decade now, despite mounting criticism at home and abroad, primarily to check China's growing influence in that country.

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