UPDATE 1-Top India aide briefed U.N. body on atom draft

(Updates after briefing finished, adds diplomat comment)

By Mark Heinrich

VIENNA, July 18 (Reuters) - Senior U.S. and Indian officials met the International Atomic Energy Agency chief on Friday and briefed IAEA governors to resolve questions about India's plan for expanded nuclear inspections.

India negotiated the safeguards scheme with IAEA experts and the text is to be considered by the U.N. watchdog's 35-nation governing board in a special Aug. 1 session. Approval is a precondition for launching a U.S.-Indian nuclear trade accord.

If it passes, India and the United States must win clearance from a 45-nation group that regulates sensitive nuclear trade, then ratification by the U.S. Congress for the controversial 2005 nuclear agreement to take force. India agreed to subject its 14 declared civilian atomic reactors to inspections to help enable it to import "trigger list" nuclear items for peaceful use, even though it has shunned the Non-Proliferation Treaty (NPT) and tested atomic bombs.

Indian Foreign Secretary Shiv Shankar Menon consulted with IAEA Director-General Mohamed ElBaradei on Friday hours before an afternoon briefing with agency governors as well as delegates from the Nuclear Suppliers Group (NSG).

Mostly technical questions came up at the briefing but no participants expressed opposition against the safeguards proposal, according to a diplomat who attended the meeting. Menon and diplomats coming out of the meeting had no comment.

"Technical questions were posed by a number of countries and Menon addressed them all," said the diplomat who requested anonymity. "He stressed that this was a standard safeguards agreement under the IAEA statute."

ElBaradei also received U.S. Undersecretary of State William Burns for talks on India. Burns was making a brief stopover in Vienna en route to Geneva where he will join talks with Iran on its disputed atomic work in an unprecedented step by Washington.

Menon, Burns and ElBaradei had no comment for reporters.

ELBARADEI BACKS U.S.-INDIA DEAL

ElBaradei has endorsed the U.S.-Indian deal as a boost for non-proliferation and peaceful use of relatively clean nuclear energy in the developing world. IAEA lawyers have vetted the India inspections draft as consistent with safeguards standards.

But India is lobbying hard to defuse concerns about parts of the safeguards text seen as possible loopholes, and possible resistance in the NSG to awarding an unconditional waiver for trade with one of just three non-NPT countries in the world.

Diplomats wanted India to clarify language in the safeguards draft hinting inspections were not necessarily permanent, and possibly blurring what are now supposed to be clear divisions between New Delhi's civilian and military nuclear sectors.

They cited a "corrective measures" clause in the preamble hinting India could halt inspections if nuclear fuel imports were cut off, for example in protest at another nuclear test.

The omission from the plan's annexe of facilities to be covered by inspections has also raised eyebrows, they said.

"India had to do this briefing because we want to be sure their interpretations of the text are identical to the IAEA's. The bigger concerns will be in the NSG -- what example would India set for the NPT," said a Western diplomat on the board.

India and the United States are counting on approval since the IAEA's inspectorate had recommended it and the majority of Indian reactor would be opened to U.N. monitoring for the first time, ushering India towards the non-proliferation mainstream.

Washington says the deal would forge a strategic partnership with the world's most populous democracy, help India meet growing energy demand and open a nuclear market worth billions of dollars to exporters globally.

Before the Aug. 1 meeting, however, India's government faces a tight no-confidence vote. If the government loses next Tuesday, early elections will be called and the entire nuclear initiative could disintegrate. (Additional reporting by Boris Groendahl) (Editing by Elizabeth Piper)