There is a very strong desire to move forward on this in India, she told the Senate Foreign Relations Committee Thursday at her confirmation hearing for the post of assistant secretary of state for South and Central Asian affairs.
Daughter of first generation Indian-Americans, Biswal has been the assistant administrator for Asia at the US Agency for International Development (USAID), since September 2010. She will replace Robert Blake.
"But I think it is going to be a political challenge for the Indians. And we look forward to working with them," Biswal said acknowledging that "there has been very slow and halting progress" on the landmark agreement because of the tough liability law.
"It is going to be a long and tough road to work through the issues with the nuclear liability law", but it was fundamentally in the interests of both countries to do so, she said in response to a question from Democrat Senator Tim Kaine.
Describing the nuclear deal as "a transformational agreement" in India-US relationship, Biswal said it would probably serve as a model for nuclear agreements for peaceful use of nuclear power around the world.
However, Biswal, who would be the first American of South Asian descent to head the regional bureau, suggested "some progress" on a "small contract" between US nuclear reactor manufacturer Westinghouse and India's Nuclear Power Corporation of India Ltd (NPCIL).
"We're hopeful that that is something that can be announced in the near future and that that will pave the way for additional work in the months ahead," she said hinting at the possibility of an announcement during Prime Minister Manmohan Singh's Sep 27 US visit.
Biswal also pledged to further "strengthen and expand" India-US ties saying the fundamentals of the Indian economy remained strong despite recent concerns, and further liberalisation would strengthen relations.
"India needs to, perhaps, take a more aggressive stance on opening and liberalising its economy, and that will enable further partnership between the United States and India on the economic front," she said.
"India's growing economic power makes it a vital anchor for the vision of regional engagement as well as a cornerstone of America's strategic rebalance to Asia," she said noting India-US trade has quintupled over the past 10 years to almost $100 billion.
Referring to India's concerns over planned withdrawal of US combat troops from Afghanistan in 2014, Biswal said: "There is understandable anxiety in India and across the region about what this transition will bring, but we are in a very close dialogue with the Indians."
"I actually think that there is somewhat of a convergence of interest here in that neither India nor Pakistan wants to see an insecure and unstable Afghanistan," she said.
John McCain, 2008 Republican presidential candidate, cited Biswal's nomination to criticise Russian President Vladimir Putin's assertion that the US should not see itself as "exceptional".
"I think you and others like you are a great example of the fact that we are an exceptional nation," he told Biswal.
In response to Republican senator Jim Risch's criticism of Obama administration's extension of an Iran sanctions waiver to New Delhi, Biswal defended the decision saying Iran used to be India's second-largest supplier, but is now fifth or sixth.