High Technology in the Emerging Dynamics of US-India Relations

Sachin Tiwari
February 16, 2020


High technology serves as a vital foundation for the US-India relations continuing gradually since the end of the Cold War and growing exponentially between the two countries. Under the leadership of Bush and Vajpayee administrations in the US and India, respectively, high technology, space, missile, nuclear, and information technology became a focal point with the lifting of sanctions in 2001. The nature of understanding developed further with the 2004 Next Steps in Strategic Partnership, which involved a major boost for trade in high technology and expansion of the dual-use technology for space and nuclear program. The equations due to the changing nature of the Asian maritime geopolitics, war on terror, emerging issues with China, elevated status of India as a strategic partner, its status as a Major Defense Partner, and growing economic partnership and defense ties have forged bilateral relations much closer. In the case of technology specifically, India’s position is a point of the bargain, trading-off services with the US for the technological advantages which the US possesses owing to its leadership in the area. 

The civil nuclear agreement of 2007 paved a new path for easing regulatory regimes like MTCR (Missile Transfer Control Regime), which restricted the dual-use technology transfer. The export control initiative of 2011 extended the ongoing delisting of the Indian organization and companies significantly, allowing for trade in high technology. The broader shift was the stabilizing of the Indo-US relations, which aligned with India’s security interest and President Obama’s National Export initiative to boost exports. The variety of areas included defense, communication, space, medical, power, and civic services in technology transfer. During the period, complex regulations of intellectual property rights, which have been considered important for US tech edge and which served as contention between Indo-US relations owing to the allegation of weak protection in India, were eased limited to less than 1 percent for the dual-use technology license.

 Under the Obama and Modi administrations, the security initiative has been extended in the form of foundational defense pacts, reflecting a shift in the posture of India with active involvement with the US. The agreement on information sharing and logistics laid the foundation with the interoperability clauses building closer coordination between US and Indian defense forces. In this respect, a series of defense agreements were placed on the bilateral table, prominently including the Communication Compatibility and Security Agreement (COMCASA), Logistic Support Agreement (LEMOA) and Basic Exchange and Cooperation Agreement (BECA) – providing for the real-time intelligence and imagery by the US vessels would be shared in encrypted form. Also, the interoperability of the devices being sold to India gets restricted due to security concerns emanating from unmatched platforms. Nevertheless, the convergence of the system has been placed under a strategic objective with India’s concerns for data sharing still under purview. 

The convergence on the Indo-Pacific envisioned under “free and open Indo-Pacific” with the rise of China’s dominance and friction over several critical issues, including navigation in the South China Sea, remain unifying factors in India-US relations. These convergences have continued under the Trump administration. In the defense sector, the acquisition has grown, and India has been deemed as critical to technology transfer with license-free space and defense authorization under Strategic Trade Authorization (STA-1), something which is limited to allies and NATO partners. The period has also witnessed the S-400 missile system from Russia, which the US has criticized grounds of security and political reasons. Turkey, a close ally, has faced severe criticism and increasingly faces the threat of withdrawal of sensitive technologies in the future. This remains an area of non-clarity in US-India relations. Further, the development of the Defence and Technology Transfer Initiative (DTTI) in 2012 for co-production witnessed a stalled project, as the jet engine technology demonstrated the reality of control over export control regime and transparency from both sides. 

The rise of the strategic technology with dual-use also has witnessed challenges due to the strain between civilian and military assets shaping the larger security environment. The US IT firms cover a huge global market, especially internet giants, and have faced stricter regulation in the EU and severe restrictions in China. India’s adoption of data localization rules allowing for the mandatory storing of the data in India conceived under stronger data protection policies and rules for e-commerce are faced with friction with tech firms. The tech firms must build data servers which have cost implications and control over the data. Further, the case of the technology leadership between the US and China has pushed for Huawei and other Chinese firms as a major security threat. India’s decision to deploy the company is strategic hedging for critical 5G technology vital to building next-generation networks.

The convergences between India and the US are important in a changing international environment, where the development of India is vital to the US’ interests. In this perspective, technology, especially of strategic relevance, serves as the foundation for India as a security ally in the region, especially with the emerging geopolitical situation in the form of threats from China and an economic partner with the changing in the global economy in the form of India. Despite numerous areas of friction, the favorable environment in US-India relations has continued with India’s access to high technology. However, there needs to be a greater degree of clarity in the terms such as major defense partner to chart a better course forward.

*** The author is currently a PhD scholar at the Centre for Canadian, US & Latin American Studies, School of International Studies, Jawaharlal Nehru University ***