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India inks pacts with Myanmar during Singh's visit

NAYPYITAW, Myanmar (AP) -- India agreed Monday to provide Myanmar with a $500 million credit as one of 12 deals signed during Indian Prime Minister Manmohan Singh's visit to the Southeast Asian country.

Singh is on a three-day visit that underscores India's quest for energy supplies and concerns about China's strong influence in Myanmar.

He met with Myanmar's reformist President Thein Sein, and together they attended the signings for the credit line between the Myanmar Foreign Trade Bank and the Export and Import Bank of India, an air services pact and other agreements.

Singh's visit is the first in 25 years by an Indian prime minister, even though the two countries share a 1,600-kilometer (1,000-mile) land border, as well as a maritime border in the Bay of Bengal. Then-Prime Minister Rajiv Gandhi visited Myanmar in 1987.

The current trip follows high-level visits to India by Thein Sein in October and reciprocal visits by the foreign ministers of the two countries.

In the 1980s and early '90s, India was a strong supporter of pro-democracy leader Aung San Suu Kyi in her fight against Myanmar's military. Singh will meet Tuesday with Suu Kyi, now the parliamentary opposition leader.

But in the mid-'90s, India changed tack to engage with the country's military junta, resisting pressure from the Western democracies that had imposed economic sanctions on Myanmar.

New Delhi insisted it had to follow a pragmatic policy because it needed its neighbor's help to crack down on Indian rebels who had built hideouts in the jungles along the India-Myanmar border.

India is also wary of China's major influence in Myanmar, and is in competition with its large regional rival for access to the country's large natural gas resources.

India remains "committed to a close, cooperative and mutually beneficial partnership with the government and people of Myanmar," Singh said in a statement before leaving New Delhi on Sunday.

The installation last year of Thein Sein as a military-backed but elected president and his initiation of democratic reforms opened up new prospects.

The field became more level for foreign traders and investors, but also more competitive as Western nations eased economic sanctions imposed during the previous military regime.

Indian automotive giant Tata Motors announced Monday that it has entered into an agreement with Myanmar's Apex Greatest Industrial Co Ltd. for the distribution of Tata's commercial vehicles and passenger cars in Myanmar.

It already has constructed a heavy truck assembly plant for a Myanmar state enterprise that was inaugurated in December 2010.

Bilateral trade between India and Myanmar was around $1.2 billion in 2011. Both sides hope to push trade to $3 billion by 2015.