By Bruce Cheadle, The Canadian Press

NEW DELHI - Terrorist threats and civilian nuclear commerce performed a delicate dance Tuesday as the prime ministers of Canada and India pledged mutual co-operation on a pair of hot-button issues that could bedevil a renewed Indo-Canadian relationship. Stephen Harper, near the end of his first visit to the South Asian giant since assuming office four years ago, sat down with Manmohan Singh to face a two-question news conference that managed to link two seemingly disparate issues.

The meeting came as India was putting its nuclear facilities on alert due to intelligence linked to a Pakistani-Canadian being held on terrorism charges in the United States. Media reports said the same Canadian was in Mumbai in the days before attackers laid siege to the city last year.

So while Indian news media asked Harper, in effect, about the troubling case of Tahawwur Hussain Rana, Canadians were questioning how the case impacts on a looming renewal of civilian nuclear trade with a country that holds a rogue atomic arsenal.

India - which has never signed on to the Nuclear Non-Proliferation Treaty -used Canadian nuclear know-how to secretly build and test its first nuclear bomb in 1974, a development that soured relations for almost two decades.

"We are not living in the 1970s. We are living in 2009," Harper said at a joint news conference with Singh in New Delhi.

"Notwithstanding the challenges that face this country in the neighbourhood in which it lives, this is a stable and reliable friend of our country and we have no reservations pursuing this kind of (civilian nuclear) agreement."

Elected leaders seldom discuss terrorism cases in public, but Singh and Harper both publicly acknowledged they had discussed the Rana case.

Singh called it "a very fruitful discussion in expanding areas of co-operation between our two countries in dealing with the international scourge of terrorism."

Harper said Canada has been working very closely with the Americans on the case, adding "we are certainly resolved to co-operate closely in the future and exchange information on these matters," with India.