President Obama took steps forward this weekend to promote both U.S. trade and national security by announcing significant export control reforms with India. According to a Whitehouse Fact Sheet, “Indian Prime Minister Singh and President Obama committed to work together to strengthen the global non-proliferation and export control framework and further transform our bilateral export control cooperation to realize the full potential of the strategic partnership between the two countries.”
So what does this really mean? For one, the United States is going to actively work with India to help the country gain membership in the four multilateral export control regimes. This is significant not only because the National Association of Manufacturers specifically called for improved multilateral engagement in our Manufacturing Blueprint for a 21st Century Export Control Regime, but also because effective proliferation controls depend upon strong multilateral controls. India’s membership will promote greater harmonization of export control systems and help drive consistent implementation of standards across member countries. Given India’s ever increasing and growing role in global security and economic matters, this integration is important for U.S. national security and the manufacturing sector.
Second, the United States will “realign” India in its dual-use export control regulations to reflect India’s status as a strategic partner, effectively treating India similarly to other close allies and partners. India will no longer be listed as a “country of concern” and will establish re-export controls to prevent bad actors from trying to export U.S. technology in India to proscribed third countries. This realignment is significant given the President’s previously announced reforms. Under the Administration’s proposed three-tiered control list, allies and partners will receive considerably more favorable treatment and exports to those countries will be subject to fewer restrictions.
India is an important market for manufacturers and knowing that the export process will likely be more transparent, predictable and transparent for exports to India will increase the competitiveness of U.S. manufacturers vis-à-vis their competitors in the European Union and Asia.
Manufacturers in the United States welcome President Obama’s continued commitment to modernizing the U.S. export control system, and the improved relationship with India will help the President bolster national security and economic growth. We look forward to continuing to work with the President on reforms.