US gives India Strategic Trade Authorisation-1 status: All you need to know about what this means

The United States eased export controls for high technology product sales to India, granting it the same access as NATO allies — Australia, Japan and South Korea.

US Commerce Secretary Wilbur Ross on Monday said that the move to grant Strategic Trade Authorisation (STA-1) status to India reflects its efforts to improve its own export-control regime, its adherence to multilateral export rules and its growing status as a US defence partner.

“STA-1 provides India with greater supply chain efficiency, both for defence, and for other high-tech products,” Ross said, adding that the elevated status would have affected about $9.7 billion worth of Indian goods purchases over the past seven years.

India’s ambassador to the United States, Navtej Singh Sarna lauded the development and said,“It is a sign of trust, not only in the relationship but also (in) Indian’s capabilities as an economy and as a security partner, because it also presupposes that India has the multilateral export control regime in place which would allow the transfer of more sensitive defense technologies,” he said.

File photo of US Commerce Secretary Wilbur Ross. ReutersFile photo of US Commerce Secretary Wilbur Ross. Reuters
What is Strategic Trade Authorisation (STA)?

STA allows for license exception with regards to exports from the US. This type of US government authorisation allows a certain item to be exported under defined conditions without a transaction-specific license, according to a report in Descartes Customs Info.

India elevated to STA-1 status

India's inclusion is beneficial mostly for the purposes of increasing the speed of sale of high-tech defence and non-defence products that are otherwise subjected to strict controls and licensing, Hindustan Times reported.

The move means that India can get easy access to latest defence technologies, with the reduction of the number of licenses needed for exports from the US.

It is also a boost for the foundational Communications, Compatibility and Security Agreement (COMCASA), according to analysts.

“It’s significant,” Benjamin Schwartz, a former defence department official who is now with the US-India Business Council said to Hindustan Times. “Looking at current exports from the US to India, 50% of those are eligible now under STA-1. This can free up $2.1 billion in trade, make US exporters more competitive in the global marketplace, help provide India more advanced US technology.”

India and the United States share an interest in countering China’s expanding economic and military weight and the United States has emerged as a top arms supplier to India, selling more than $15 billion of weapons over the past decade as New Delhi modernizes its Soviet-era military.

It is a timely announcement as it comes ahead of the 2+2 dialogue scheduled for early September when US Secretary of State Mike Pompeo and Defence Secretary James Mattis are due to visit India and meet with their counterparts, he said.

List of items affected

According to the US Department of Commerce, items eligible for export to STA-1 nations include those under control for national security, chemical or biological weapons, nuclear non-proliferation, regional stability, crime control.

The categories also include electronics, lasers and sensors, information security, computers and electronics, navigation, telecommunications, aerospace, etc.

With inputs from agencies.