US removes ISRO, DRDO from export control list

WASHINGTON: The United States on Monday removed several Indian government defense-related companies, including subsidiaries of DRDO (Defense Research and Development Organisation) and ISRO ( Indian Space Research Organization), from the so-called Entity List, in an effort to drive hi-tech trade and forge closer strategic ties with India.

The move, which was described as the "first steps" to implement the export control policy initiatives announced by President Obama and Prime Minister Manmohan Singh on November 8, 2010, precedes a visit to New Delhi on February 6 of Commerce Secretary Gary Locke, who is leading 24 U.S. businesses on a high-tech trade mission to India.

But the relaxation of export controls is aimed at more than just ginning up hi-tech trade and US exports, US officials said. An administration official who briefed correspondents on background left little doubt that the relaxation had larger strategic implications, pointing out that the re-ordering of rules to exempt India spanned three U.S administrations and Presidents and two Indian governments and Prime Ministers, and was result of greater engagement and growing trust between the two countries.

Locke himself said in a statement that "Today's action marks a significant milestone in reinforcing the US-India strategic partnership and moving forward with export control reforms that will facilitate high technology trade and cooperation."

Following up on exemptions long sought by India, in a process that involved tortured negotiations, the U.S Commerce Department's Bureau of Industry and Security on Monday published a Federal Register Notice which updates the Export Administration Regulations (EAR) relating to India in several ways.

Among them

à Removing several Indian space- and defense-related companies, including four subsidiaries each of DRDO and ISRO, and Bharat Dynamics, from the Entity List. Removal from the Entity List eliminates a license requirement specific to the companies, and results in the removed companies being treated the same way as any other destination in India for export licensing purposes.

à Removing India from several country groups in the EAR resulting in the removal of export license requirements that were tied to India's placement in those country groups. Countries that figure in EAR include China, Pakistan, Russia, and in some instances, even Israel.

à Adding India to a country group in the EAR that consists of members of the Missile Technology Control Regime, to recognize and communicate India's adherence to the regime, the U.S.-India strategic partnership, and India 's global non-proliferation standing.

While the changes move India into different league altogether, Washington also has several requirements from New Delhi to ensure it stays in line with its non-proliferation goals. "These changes reaffirm the US commitment to work with India on our mutual goal of strengthening the global nonproliferation framework," Under Secretary of Commerce Eric Hirschhorn, said in a statement on the occasion of the changes.