Trump’s Visit to India: Relooking into India-US Defence Trade and Technology Transfer

Sweta Kumari
February 16, 2020


Image Courtesy: The Hindu Business Line

 US President Donald Trump is making his maiden visit to India at the end of February 2020. Several speculations are doing rounds regarding the visit. The expectation would be the conclusion of concrete trade norms acceptable to both India and the US, even if the signing of a comprehensive trade deal would not be possible. Apart from that, the visit will also be crucial with regards to defense trade and cooperation, particularly, in the light of the announcements made by the India’s Foreign Minister S. Jaishankar and his counterpart US Secretary of State Mike Pompeo along with India’s Defense Minister Rajnath Singh and US Secretary of Defense Mark Esper during the second edition of 2+2 Ministerial Dialogue recently held in Washington DC. Prime Minister Modi and President Trump have given priority to enhance bilateral defense cooperation. 

Reaching an agreement over the ‘Industrial Security Annex (ISA)’ was a significant step to remove the logjam that was preventing the US defense industry from engaging with the Indian collaborators, given the fear of the technological leak in the process of information exchange. It would also help the Indian defense establishment to prepare and upgrade itself to be compatible with the high-end technologies of the US military equipment. Following the footsteps of their American collaborators, the private sector in India would also get a boost from the conclusion of this industrial security pact to involve with defense manufacturing under the PM Modi’s ‘Make in India’ initiative. This advancement is hoped to give thrust to the resolve of co-development and co-production in the defense sector between the two countries. 

There have been rough patches in streamlining defense trade and collaboration despite some bold initiatives taken in the past few years. The idea of co-development and co-production was highlighted in 2015 through India-US Defense Technology and Trade Initiative (DTTI) and its four pathfinder projects, a joint working group on Aircraft Carrier cooperation, and a Jet Engine Technology cooperation under the leadership of President Obama and Prime Minister Modi. However, the lack of a comprehensive framework to implement these projects, technological hurdles, bureaucratic delays, and other contributing factors have ultimately led to their suspension a few months ago. 

This setback further highlighted the importance of removing technical barriers in order to enhance defense trade between the two countries. The Trump administration, since the beginning, has tried to develop strong defense ties with India and to treat it as a major defense partner. One such effort was the Strategic Trade Authorisation-1 (STA-1) status that was given to India, which was the only non-NATO partner of the US and the third Asian country (after Japan and South Korea, the formal allies of the US) to get such special recognition. This is supposed to relieve India from the obligation of getting transaction-specific licenses underlined by technology export control laws of the US in order to import some of the items in the Commerce Control List. India and the US under the Trump administration have also signed the Communications Compatibility and Security Agreement (COMCASA), while the Basic Exchange Communications Agreement (BECA) remains under negotiations. The Industrial Security Annex can prove seminal in the implementation of these agreements by enabling the American defense manufacturers to share high- end technology with the Indian counterparts. The two governments’ initiative of new technological cooperation by developing drone warfare, light weight arms and networked systems under the ambit of a renewed version of the DTTI is one such area where this will be very crucial.

The enhancement of defense trade and high-end technological transfer has been the most critical area where India and the US have mutually agreed during the current administration, although challenges remain. Thus, apart from the global trade negotiations, some important announcements on defense like the Integrated Air Defence Weapon System (IADWS), also known as the National Advanced Surface-to-Air Missile System-II or NASAMS-II are expected from the visit of President Trump to India. Besides, the fact that India and the US are likely to sign a contract worth USD 2.6 billion for MH-6R Sea-Hawk helicopters for the Indian Navy is a huge boost for the bilateral relations as well as for enhancing capabilities of the Indian Navy.

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