Australia's mineral-rich Queensland state reversed a decades-long ban on uranium mining Monday, citing rekindled interest in the nuclear fuel after Canberra gave the go-ahead to exports to India.

Uranium has not been dug in Queensland since the 1982 closure of the major Mary Kathleen mine, while mining for it was outlawed by the state government in 1989.

But Premier Campbell Newman said the national government's overturning of an export ban to India last year, and Prime Minister Julia Gillard's recent talks in the subcontinent about kick-starting the trade, prompted a rethink.

India had been blacklisted due to its refusal to sign the Nuclear Non-Proliferation Treaty. But it has not been a pariah since 2005, when it entered into an IAEA-approved civil nuclear agreement with the United States.

Australia anticipates entering into a similar agreement with India, one of its fastest-growing trade partners.

"The Prime Minister Julia Gillard has just been in India selling the benefits of Australian-produced uranium to India, prompting many in the community to ask about the industry's potential in Queensland," Newman said.

"It's been 30 years since there was uranium mining in this state, and in that time Northern Territory, South Australia and Western Australia have carved out successful uranium industries that deliver jobs and prosperity to their regions."

The policy shift would not extend to nuclear energy production or waste disposal.

Queensland's known deposits of uranium, a key input in nuclear power generation, have been conservatively estimated as worth Aus$10 billion (US$10.3 billion).

Major industry lobby group the Australian Nuclear Association said the ban had been "illogical and unsustainable" and its overturning was timely.

"New uranium mines will be needed to supply Indian nuclear reactors and Queensland could be ready just in time to supply that new demand," said association chief Michael Angwin.

Queensland is already a major coal mining region and has a burgeoning gas industry as well as significant deposits of lead, zinc and silver.

Australia does not use nuclear power but it is the world's third-ranking uranium producer behind Kazakhstan and Canada, exporting 6,888 tonnes of oxide concentrate in 2010 worth more than Aus$600 million.

It also has the world's largest uranium reserves, holding 31 percent of the global total, according to the World Nuclear Association.

Japan, the United States and European Union account for the majority of Canberra's exports of the nuclear fuel, with smaller shipments to South Korea, China, Canada and Taiwan.

State governments have historically opposed uranium mining due to concern about potential environmental impact, the difficulties associated with storing waste products and its links with nuclear weapons.

But National Resources Minister Martin Ferguson last year described uranium as a "key industry" for Australia, estimating that total output would double within four years and quadruple within two decades.

Neighbouring New South Wales state overturned its quarter-century ban on uranium exploration in February. Victoria is now the only Australian state with a total ban on uranium mining or exploration.