Germany [Images] favours an end to India's nuclear isolation but will decide on its cooperation in the sector only after New Delhi works out a safeguards agreement with IAEA as it is keen to see that the initiative does not affect the non-proliferation regime.

Special envoy Shyam Saran, during his recent visit to Germany, was told that India should take more steps to associate with the NPT like signing CTBT and Fissile Material Cut-off Treaty (FMCT), a senior German official said in New Delhi.

Ahead of the visit of Chancellor Angela Merkel here, the official said the key Nuclear Suppliers Group (NSG) member understands India's reasoning for acquiring nuclear energy for peaceful purposes and was ready to discuss the issue.

Germany, however, wants to see that the move does not affect the NPT system. India is in a "corner" of the international nuclear regime and should be brought into the mainstream, the official said while favouring grant of access to New Delhi to fuel and technology in the field.

Merkel is inclined to look favourably at the Indo-US nuclear deal but wants further discussions to ascertain that it does not affect the NPT regime.

"We will not be dealing with the issue till all parameters (in the Indo-US deal) are in place. The last pillar in the initiative is safeguards agreement with IAEA. We will have to see the form of the agreement before making our decision," the official said.