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India and US Sign Aviation Agreement

India and the United States have signed an agreement to boost aviation links between the two countries.

The new "open skies" agreement between India and the United States replaces a decades-old pact that restricted flights between the two countries.

The accord signed a few days ago will allow Indian and U.S. carriers to operate as many flights as they want.

India's Civil Aviation Minister Praful Patel says the new policy will ease business travel and lower fares at a time when economic links between the two countries are growing. "This would also be going a very long way not only building up people-to-people relationships, but also will act as a great boost for enhancing ties in the areas of trade, industry, tourism, and also employment generation," he says.

The agreement should be a boost for India's flourishing software industry, to which U.S. companies outsource work worth billions of dollars.

Several airlines are expected to begin direct flights between India's information technology city of Bangalore and American cities. Now, all the U.S.-bound flights out of India originate out of New Delhi or Bombay.

One U.S. carrier ['Delta] has already announced plans to begin a daily service between New York and the southern Indian city of Chennai.

U.S. Transportation Secretary Norman Mineta says the new policy will provide better services to the approximately two million passengers traveling between the two countries.

But he says that is only part of the story, and the new agreement is also a symbol of the growing relationship between New Delhi and Washington. "The Bush administration's position is clear. America is committed to helping India to become a major world power in the 21st century and a strong Indian aviation system is a core component of reaching that goal," he says.

Secretary Mineta says the United States has asked the Indian government to consider a bid by Boeing company to sell aircraft to India's state-run carrier Air India. The airline is expected to shortly finalize a deal to buy 50 jets worth $6 billion. It is considering Airbus or Boeing, or a combination of both.