Euphoria over President George W Bush pushing that "wonderful deal" through a lame duck Congress in its dying moments gave way to despair as the dawn of the New Year will still see negotiators set out to write a 123 agreement to get the deal going.
If India wanted to get into the world nuclear club with its right to conduct a test intact besides uninterrupted fuel supplies and reprocessing rights, the enabling Henry Hyde Act passed by the US Congress would have none of it.
Hopes soared high again when negotiators accomplished "the mission impossible" exactly two years and two days after Prime Minister Manmohan Singh and Bush struck the deal on July 18, 2005, to resume their nuclear trade after 30 years.
The accord described as a clear recognition of "a real difference" between India and Pakistan was seen as the culmination of what Secretary of State Condoleezza Rice calls 'de-hyphenation' of the two South Asian neighbours in Washington's worldview.
But it wasn't long before the deal took a nosedive again with the Indian government's Communist allies crying fowl over New Delhi allegedly entering into a "strategic partnership" with capitalist America in a junior role.
With the rightist Bhartiya Janata Party (BJP) - which had itself set the nuclear ball rolling when it was in power - refusing to bail the government out, corporate America eyeing $150 billion in business joined all the president's men to push the deal.
Optimism raised its head again as the Communists let New Delhi talk to the International Atomic Energy Agency (IAEA) and a scramble began to clear all the remaining hurdles before the US Congress, which has to approve the final deal, gets into presidential election mode early next year.
But even as the deal went through its ups and downs, Washington, recognising India's emergence as an increasingly important player on the world stage, vowed to keep expanding their relations regardless of the fate of what was touted as the "symbolic centrepiece" of a new alliance.
President Bush invited India to a US-sponsored 50-nation Middle East peace conference that resulted in Israeli and Palestinian leaders agreeing to negotiate a peace treaty by the end of 2008. India was also among the world's 17 major economies that came here in search of a new framework for energy security and climate change.
With India's international profile soaring, most candidates for the 2008 US presidential elections on either side of the political divide are making a concerted bid to woo Indian American voters and their top donors.
Almost all the candidates serving in Congress voted for a landmark law to begin civilian nuclear cooperation with India as well as a range of other economic deals. Unlike in 2004, outsourcing to India is yet to emerge as a major election issue.
Democratic presidential hopeful Barack Obama courted controversy with a "Punjab jab" against rival contender Hillary Clinton. But he quickly made amends when his campaign faux pas in referring to her as 'Hillary Clinton, D-Punjab,' - journalistic shorthand for Democratic senator from Punjab - as the Indian-American community took umbrage.
Eyeing new opportunities for US businesses and workers in India's growth, Washington allowed American companies to sell high-tech dual-use products with potential military applications to pre-screened customers in India without an individual licence.
Reducing US exports to India requiring a commerce department licence to less than one per cent from 24 per cent in 1999, the US hoped to sell New Delhi high-tech electronics, avionics, aerospace, and life sciences worth millions of dollars.
The Indian Navy acquired an old warhorse, the USS Trenton, its first warship from the US and commissioned it as INS Jalashwa (Sea Hippopotamus) to make a quantum jump in integral sealift and airlift capabilities of Indian maritime forces.
As business bloomed India and the US hoped to double by 2009 their two-way trade volume now touching almost $30 billion.
Indian air carriers placed orders for 138 planes from Boeing, including 37 of its latest offering, the Boeing 787 Dreamliner, with an eye to recapture the market share they have been losing to foreign airlines.
Looking beyond outsourcing, a clutch of 34 global Indian companies invested a whopping $6 billion in the US through acquisitions and mergers and created 40,000 jobs with quite a few of them going to the Americans.
Tata Tea made a cool profit of $523 million with Coca-Cola buying its 30 per cent stake in Vitaminwater maker Glaceau for 1.2 billion.
Indians abroad too set out to conquer corporate America, with Indra Nooyi taking over as chairman and CEO of PepsiCo. The troubled Citigroup, the world's largest financial services company, turned to Nagpur-born Vikram Pandit to set its house in order.
Pandit, Nooyi and Ramani Iyer, chairperson and CEO of the $27-billion Hartford Financial Group, made up the trio of Indian Americans in The New York Times list of 15 foreign born CEOs of Fortune 100 companies.
Nooyi also topped Fortune magazine's annual list of the 50 Most Powerful Women in Business for the second year in a row and was placed fifth, a notch ahead of Congress party president Sonia Gandhi among the world's 100 most powerful women.
The number of legal immigrants from India swelled to about 1.7 million, with some 629,000 coming in 2007, making it one of the top three exporters of people to the US.
For the sixth year in a row, India sent the most number of students to the US in 2006-07 with a total of 83,833. India also dominated with one in seven of international students who together contributed $14.5 billion to the US economy.
In politics, Bobby Jindal was elected governor of Louisiana to become the first Indian-American chief executive of a US state. The US Congress honoured Dilip Singh Saund, the first person of Indian origin to make it to the House nearly 50 years before Jindal, with a portrait in the complex.
The US House of Representatives and the Senate adopted resolutions "recognising the religious and historical significance of the festival of Diwali".
India American astronaut Sunita Williams went on a 195-day record space odyssey for a woman surpassing US astronaut Shannon Lucid's 188-day mark. With four excursions spread over 29 hours and 17 minutes she also topped Kathy Thornton's 21-hour record to become the world's most experienced woman space walker.
In the world of entertainment, a record number of Indian films reached blockbuster status in the US with half of the 14 foreign language films that grossed over $2 million being in Hindi. No other language came close to contributing so many box office hits to the list.
Hollywood's first Bollywood film Saawariya made waves in the US. So did Shah Rukh Khan starrer Om Shanti Om while mainstream US media went gaga over Indian American director Mira Nair's latest venture The Namesake, making it one of the best reviewed Indian films ever in the US market.