After the meeting, Nuland thanked Kwatra for a “very productive” dialogue. “Together we will grow our economies and create jobs through increased bilateral trade and better high-tech collaboration.” The dialogue comes in the wake of US secretary of defense Lloyd Austin’s visit to New Delhi this week, where both sides concluded a defence industrial road map which too will require flexibility by the US on export control issues.
The presence of both the State and Commerce departments in the dialogue represents the complexity of the process in the US where different arms of the administration have jurisdiction over different export control regimes. While the International Traffic in Arms Regulations (ITAR), administered by State department, controls export and import of defence related articles, services and technologies, the Defense Federal Acquisition Regulation Supplements (DFARS), administered by department of defense (DoD), provide a standard set of processes for government acquisitions. In addition, the bureau of industry and security in commerce department maintains and strengthens “export controls and treaty compliance systems”. And then, there are export control mechanisms that are controlled by the US Congress. Flexibility both in the executive and then legislative branches will be essential to fulfil the promises of ICET.
Explaining the significance of the dialogue, Kriti Upadhyaya, founding director of the INDUS Tech Council and vice-president of C2Ci Americas, said that focused on easing regulatory restrictions, the strategic trade dialogue was likely to have grappled with issues such as ITAR and DFARS. “An ITAR license is generally required for the transfer of sensitive technologies from the US. Indian firms will benefit from India-specific exemptions, and a more transparent and time-bound ITAR licensing process. Similarly, presently, Indian firms cannot supply to the US DoD under most regular circumstances as India is not a DFARS-qualifying country.”
She added that a reciprocal defence procurement agreement, which Austin mentioned during his India visit, will potentially be needed to make India a DFARS qualifying country. “Easing export control and other regulations can make the pathway for co-development and co-production much smoother and open the US defense market to Indian firms,” said Upadhyaya.
Atul Keshap, president of the United States-India Business Council, said that the amount of energy and political capital being dedicated by both sides to address export controls and tech releasability issues ahead of the state visit sent a signal of confidence to key business sectors and civil society. “This thrust around tech-transfer within our high trust ecosystem demonstrates that our two governments can work effectively through complex areas of negotiation when they focus their energies and establish mechanisms like ICET to accelerate interagency coordination with full political backing from leaders.”
Source- Hindustan Times.