China is softening its stance on the India-United States civil nuclear deal and has expressed its readiness to cooperate with all countries on the peaceful use of atomic energy under the safeguards of the International Atomic Energy Agency.

China is ready to "explore cooperation with all countries for the peaceful use of nuclear energy in accordance with the rules of the IAEA," Foreign Minister Yang Jiechi told an 11-member Eminent Persons' Group in Beijing [Images] on Friday, according to sources.

While Yang did not elaborate on possible Sino-India civilian nuclear cooperation, the two governments have already hinted on such a move during Chinese President Hu Jintao's state visit to India last year.

"Considering that for both India and China, expansion of civilian nuclear energy programme is an essential and an important component of their national energy plans to ensure energy security, the two sides agree to promote cooperation in the field of nuclear energy, consistent with their respective international commitments," the joint declaration issued during Hu's visit had stated.

Former ambassador to China C V Ranganathan led the Indian delegation to the two-day sixth session of the EPG meeting to China. The Chinese delegation was headed by former vice foreign minister Liu Shuqing.    

The Indian delegation was taken aback when Yang did not stress about India not being a signatory to the nuclear Non-Proliferation Treaty.

According to delegation sources, China seemed to be looking looking forward to Prime Minister Manmohan Singh's [Images] planned visit this year.

Earlier this week, Chinese Premier Wen Jiabao said he was looking forward to Singh's visit and both sides were making active preparations for a 'successful' outcome.

"Prime Minister Singh's visit this year is an important diplomatic event and a big event in the development of China-India relations," said Wen. "We are now making vigorous preparations to ensure that the visit is a success," he added.

Speaking about the outcome of the two-day EPG meeting, ex-Chinese ambassador to India Cheng Ruisheng said that both sides used it as a kind of preparatory meeting for the Indian prime minister's visit. He said that the discussions covered a gamut of topics like bilateral, regional and international issues.

The Chinese side apparently expressed concerns over the proposed quadrilateral exercises in Bay of Bengal involving the navies of India, the US, Japan [Images] and Australia and their attempt to form an alliance, which Beijing calls 'anti-China.' The Indian delegation assured the Chinese side that the initiative was not aimed against China or any other nation.

The issue of India's growing trade deficit with China as well as the need to diversify Indian exports to China was also highlighted. The Chinese side strongly urged that India should accord China full market economy status.

The representatives to the EPG include members from industry, media, culture, academia, diplomacy and public life.

The EPG was constituted to receive ideas and suggestions from eminent persons belonging to various walks of life, who will assist both countries in finding new ways and means of widening and diversifying their bilateral relationship.