Missiles on display as aircraft perform in an aerial flying display at the Aero India air show at Air Force Station Yelahanka in Bengaluru, India. (Photographer: Dhiraj Singh/Bloomberg)

U.S. Eases Export Controls For High-Technology Product Sales To India

In a major boost to India, the U.S. today eased export controls for high-technology product sales to it by designating it as a Strategic Trade Authorization-1 (STA-1) country, the only South Asian nation to be on the list.

Responding to a question at the first Indo-Pacific Business Forum organised by the U.S. Chambers of Commerce Wilbur Ross said the STA-1 designation “acknowledges” the India-U.S. security and economic relationship. The granting of STA-1 status to India comes after the U.S. recognised India as a “Major Defence Partner” in 2016, a designation that allows India to buy more advanced and sensitive technologies from America at par with that of the U.S.' closest allies.

The designation authorises the export, re-export and transfer (in-country) of specified items on the Commerce Control List (CCL) to destinations posing a low risk of unauthorised or impermissible uses.

Currently there are 36 countries on STA-1 list. India is the only South Asian country to be on the list. Other Asian countries designated as STA-1 are Japan and South Korea. Till recently India was designated as STA-2 countries along with seven others.

Ross said that India has partnered with the U.S. to improve its own export control regimes and has met most of the export control rules which the U.S. thinks are useful.

STA-1 status, Ross said, provides India with greater supply chain conditions for defence and other high-tech products. It increases the integrity with the U.S. systems and reduces time and resources needed to get licenses approved, the Commerce Secretary said.

According to the Department of Commerce, items that are eligible for export to STA1 destinations or nationals include items that are subject to control for: national security (NS), chemical or biological weapons (CB), nuclear nonproliferation (NP), regional stability (RS), crime control (CC) and significant items (SI).

The status can free $2.1 billion in trade, make U.S. exporters more competitive in the global marketplace, help provide India more advanced U.S. technology.

“This is a significant step. This is an important thing that I’m glad has happened,” Ben Schwartz of the U.S. India Business Council told PTI.

This is a recognition that the U.S. government put real trust in the Indian government in a way that hasn’t been the case before
Ben Schwartz, U.S. India Business Council

Over the past few years, Schwartz said India has basically build robust export control procedures that the U.S. government is competent in terms of their security and the fact that when things are exported there they'll remain controlled and not be diverted to alternative users.

One of the reasons to grant STA-1 status was to cut the amount of licenses that are required under the current number of exports that are coming from U.S. to India by half, he said.

This also comes following India's admittance into pretty much all the major non-proliferation regimes, the only one being Nuclear Suppliers Group (NSG). “I think everyone recognises that India has made a good faith effort to join the NSG and that it is not the Indian government that controls the outcome,” he said.