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Obama lifts exports controls, narrows "entities list"

Obama lifts exports controls, narrows "entities list"

On his first day in India, President Obama announced two measures that will warm the hearts of many American defense companies if further steps follow.

  • Speaking to business executives in a 20 minutes charm speech, he promised to loosen export controls on American goods destined for India.  Many of these export controls have prevented U.S.  corporations from offering platforms that incorporate the latest technology developed for the U.S. Department of Defense or other American organizations. India for its part has expressed reservations about buying yesterday’s American technology. Israel, Russia, France, UK, Sweden and Italy have consistently offered current products and services to help India’s security needs; as a result Israel and Russia both see India as their largest defense customer and the two countries alternate as India’s largest source of military products in recent years. The loosening of the American controls will put products from General Dynamics, Lockheed Martin, L-3 Communications, ITT, Raytheon and many others in the running. So far Boeing has had a lead over all other American suppliers of defense products.
  • There is also news that India organizations such as the Vikram Sarabhai Space Centre (part of ISRO), the Defence Research and Development Organisation (DRDO), and even Bharat Dynamics Ltd (The government owned defense company that makes missiles) are being removed from the US Department of Commerce’s “Entities List”.  DRDO labs removed from the entities list include India’s Armament Research and Development Establishment, Defense Research and Development Laboratory, Missile Research and Development Complex and the Solid State Physics Laboratory. For American companies, this list is a virtual embargo on shipping anything (without some very special permission, that is rarely if ever granted).  This is  good thing for all concerned.   DefenseWorld reports that DRDO is already hungering for possible lucrative offset contracts that may be offered to its labs by foreign suppliers who are required to spend 30% or more of large new orders on enhancing India’s defense capability.
  • Note that organizations working on India’s “strategic” nuclear program, such as the Bhabha Atomic Research Centre  (BARC)in Mumbai remain on this embargoed list. The India Expert does not expect BARC and other Department of Atomic Energy groups (IGCAR etc) to come off the entities list any time soon.  (Of course the nuclear utility, NPCIL, is not on the entities list).
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