"Australia's relationship with India and further progress in that relationship does not depend on uranium sales," the Australian Associated Press quoted the minister as saying on Sunday.

    Last week, Smith told visiting Indian special envoy Shyam Saran that the Labor government will not change its long-standing policy of not selling uranium to countries who are not the nuclear non-proliferation treaty (NPT) members.

    "India is aware of the government's policy to supply uranium only to countries which are members of the nuclear non-proliferation treaty," Smith said.

    The former Howard government agreed in-principle last year to sell uranium to India, based upon the landmark agreement.

    But the foreign minister isn't concerned the setback for India and signaled stronger ties with the economic powerhouse were one of its top foreign policy priorities.