India-US Critical Technology Cooperation: The Hurdles and Way Forward
PM Narendra Modi’s state visit to the US in June 2023 has added further momentum to the critical technology cooperation between India and the US as the significant defence contracts, particularly the agreement for the production of jet engines in India, have generated considerable excitement among the technology and defence enthusiasts.
By Anisree Suresh
The Initiative on Critical and Emerging Technologies (iCET) serves as a crucial collaborative framework between India and the United States to address critical and emerging areas of technology cooperation, such as artificial intelligence, quantum computing, semiconductors, and wireless telecommunications. Launched in February of this year, 2023, it aims to strengthen the strategic partnership between the two nations and drive cooperation in technology and defence. The framework was initially announced by Prime Minister Modi and President Biden during the QUAD meeting in Tokyo in May 2022, to shape the development, governance, and use of technology based on shared democratic values and respect for human rights.
The initiative had pushed further developments in the sharing of critical technology and the establishment of a research agency partnership to promote collaboration in fields like AI, the formulation of a new defence industrial cooperation roadmap to expedite technological cooperation for joint development and production and the development of common standards in AI. The achievements of the iCET are the result of extensive coordination and planning over several weeks and months. Since the initial announcement in May 2022, Indian and US officials have been diligently working to refine and improve the operational framework of the initiative. During Defence Secretary Lloyd Austin’s visit to New Delhi in June 2023, discussions focused on expanding defence-industrial cooperation to facilitate the co-production and co-development of military platforms and hardware. Furthermore, the roadmap unveiled by Indian National Security Advisor Ajit Doval and US National Security Advisor Jake Sullivan in June emphasized the need for enhanced collaboration in high-technology areas and addressing regulatory barriers, particularly in critical domains such as semiconductors, next-generation telecommunication, AI, and defence.
PM Narendra Modi’s state visit to the US in June 2023 has added further momentum to the critical technology cooperation between India and the US as the significant defence contracts, particularly the agreement for the production of jet engines in India, have generated considerable excitement among the technology and defence enthusiasts.PM Narendra Modi’s state visit to the US in June 2023 has added further momentum to the critical technology cooperation between India and the US as the significant defence contracts, particularly the agreement for the production of jet engines in India, have generated considerable excitement among the technology and defence enthusiasts. On June 21, GE Aerospace announced the signing of a memorandum of understanding (MoU) with Hindustan Aeronautics Limited (HAL) to jointly produce F414 jet engines in India for the Indian Air Force. Additionally, India and the United States have reached an agreement for the procurement of 31 armed MQ-9B Sea Guardian (Predator) drones, manufactured by General Atomics, at a value of $3 billion.
PM Modi and President Joe Biden reaffirmed the commitment of the United States and India to foster an open, accessible, and secure technology ecosystem. The joint statement issued by both leaders expressed their appreciation for the decision of NASA and ISRO to develop a strategic framework for cooperation in human spaceflight by the end of 2023, delivery of the NASA-ISRO Synthetic Aperture Radar (NISAR) satellite to ISRO’s U R Rao Satellite Centre in Bengaluru, and called for enhanced collaboration between the US and Indian private sectors across the entire value chain of the space economy. They also emphasize the importance of addressing export controls and facilitating technology transfer as they are committed to promoting policies and adapting regulations that facilitate increased technology sharing, co-development, and co-production opportunities among the US and Indian industry, government, and academic institutions.
President Biden and Prime Minister Modi share a vision of establishing secure and trusted telecommunications, resilient supply chains, and enabling global digital inclusion. To realise this vision, the leaders announced the launch of two Joint Task Forces focused on advanced telecommunications, specifically Open RAN and research and development in 5G/6G technologies. The leaders also welcomed the establishment of a joint Indo-US Quantum Coordination Mechanism, which aims to facilitate collaboration among industry, academia, and government in the field of quantum technology. The United States welcomes India’s leadership as Chair of the Global Partnership on AI. The launch of the iCET not only strengthens the strategic partnership between the two countries but also reflects a response to evolving strategic dynamics in the Indo-Pacific region.
In the broader context of the emerging technology competition between the US and China, the India-US critical technology cooperation has a lot of significance in building trust-based partnerships in the Indo-Pacific. As the US and China engage with one another in a semiconductor tech race, tech diplomacy continues to play a greater role in reshaping the international order and regional geopolitics. The ongoing chip war between Washington and Beijing through regulatory actions has global impacts. The primary objective of this accelerated cooperation is to counter Chinese power projection in the Indo-Pacific, where both countries have substantial stakes. Strategically, it is justified for New Delhi and Washington to seek the necessary tools to deter and dissuade Beijing, and critical technology cooperation emerges as a priority. Also, the US desire to reduce India’s reliance on Russian arms imports contributes to its embrace of India. In this context, these developments could be considered positive to elevate the US-India iCET partnership to a strategic level. However, the reality of sensitive technology sharing between India-US has some major hurdles to overcome.
The International Traffic in Arms Regulations (ITAR) is a comprehensive set of regulations established by the U.S. Department of State’s Directorate of Defense Trade Controls (DDTC) to govern the export of defence articles and services. These regulations impose restrictions on the handling of software and technical data listed on the United States Munitions List (USML). The export controls enforced by the ITAR pose significant challenges in facilitating defence technology transfers, including sensitive military technology with India as a countermeasure to China’s regional ambitions. Senators Mark Warner and John Cornyn, co-chairs of the Senate India Caucus, introduced a proposal to reduce the time Congress has to block arms sales to India from 30 to 15 days to streamline the defence sales to India. Nonetheless, the conditions imposed by the ITAR regarding the use of technology, as well as the limitations it places on India’s ability to incorporate its own intellectual property, could lead to certain issues in the technology cooperation between the two, especially with the growing prowess of Indian IT sector in domains such as integrated command and control, sensor fusion, autonomy, and data analytics. Even Australia, an official US ally, member of the Quad and AUKUS, and part of the Five Eyes alliance has faced challenges in technology collaboration due to the ITAR. This will create a serious concern in India-US technology cooperation in the coming days.
The major concerns regarding the ITAR challenges are the delays in obtaining licenses, the lack of exhausting data on denied licenses to make informed decisions by the policymakers on the status of technology transfers and the hurdles in designing interoperable systems compatible with Indian technologies. It is necessary to have a clearer understanding and action plan to overcome the challenges in sharing sensitive technologies and more research to study how each tech under iCET will be impacted by the ITAR. As the India-US critical technology cooperation is taking a new leap, it is important to address these export challenges while understanding the sensitivities of sharing critical technologies.
