India-US 2+2 Dialogue

Signing of Industrial Security Annex paves way for US Defence companies to participate in mega Make in India programmes

New foundational agreement allows American OEMs to share classified military information with Indian private sector

December 21, 2019 By Vishal Thapar Photo(s): By MEA
DOUBLE BARREL AGENDA SETTING: Defence and External Affairs Ministers Rajnath Singh and S Jaishankar with the US Secretaries of State and Defense Michael Pompeo and Mark Esper at the 2+2 Ministerial in Washington DC

The signing of the Industrial Security Annex (ISA) during the 2nd annual India-US 2+2 Ministerial Dialogue in Washington DC on December 18 has cleared the decks for US companies to participate in India's multi-billion dollar Defence procurement programmes under the Strategic Partnership model.

The ISA is a foundational agreement which has provided US companies the procedural and legal basis for sharing classified military information to India's private sector Industry while partnering these entities in bidding for mega programmes.

This agreement will immediately facilitate the participation of American companies in the $3 Billion Naval Utility Helicopter (NUH) and $21 Billion Multi-Role Fighter Aircraft (MRFA) Programmes under the Strategic Partnership Model which envisages a lead role for private sector Indian companies. Foreign OEMs will be the technology partners for private sector bidders under this model.

This agreement will immediately facilitate the participation of American companies in the $3 Billion Naval Utility Helicopter (NUH) and $21 Billion Multi-Role Fighter Aircraft (MRFA) Programmes under the Strategic Partnership Model which envisages a lead role for private sector Indian companies

Lockheed Martin-Sikorsky is fielding the S-76 helicopter in the NUH programme and the F-21 in the MRFA competition in partnership with Tata Advanced Systems Limited. Boeing is offering the F-A/18 Super Hornet. It has already announced a three-way JV with Hindustan Aeronautics Limited (HAL) and Mahindra to address the Indian Navy requirement for 57 deck-borne fighters under a separate programme.

The 2+2 Dialogue was held between India's Ministers for Foreign Affairs and Defence S Jaishankar and Rajnath Singh and their US counterparts Secretaries of State and Defense Michael Pompeo and Secretary for Defence Mark Esper to review progress in the strategic partnership and determine the agenda for onward cooperation. The 2+2 Ministerial is the highest-level institutional mechanism between the two countries for this purpose.

Lockheed Martin-Sikorsky is fielding the S-76 helicopter in the NUH programme and the F-21 in the MRFA competition in partnership with Tata Advanced Systems Limited. Boeing is offering the F-A/18 Super Hornet. It has already announced a three-way JV with Hindustan Aeronautics Limited (HAL) and Mahindra to address the Indian Navy requirement for 57 deck-borne fighters under a separate programme

"The Ministers welcomed the signing of the Industrial Security Annex (ISA) which will facilitate the exchange of classified military information between Indian and the U.S. defense industries. Both sides also expressed intent to meet in 2020 to discuss ISA implementation," the joint statement released at the conclusion of the Dialogue elaborated.

CLEARING THE DECKS: Delegation-level talks with the Foreign Affairs and Defence establishments on the same table aimed at giving depth and momentum to India-US strategic ties

An Industry-to-Industry framework was also finalised to establish a standing mechanism for dialogue between Indian and US Defence companies and also the two governments on defence technology and industrial cooperation.

An Industry-to-Industry framework was also finalised to establish a standing mechanism for dialogue between Indian and US Defence companies and also the two governments on defence technology and industrial cooperation

The Defence Technology and Trade Initiative (DTTI) too made headway with the signing of a Standard Operating Procedure for implementation of projects under this framework and setting timelines with an intention to make the process outcome driven. Earlier, in October, the two sides signed a Statement of Intent to pursue several co-development programmes in the short, medium and long terms.

"Priority initiatives have been identified for execution under the DTTI programme...These measures are expected to provide momentum to collaboration between the private defence industries of both India and the US. The two sides also agreed to move forward in their engagement in the area of defence innovation," India's Ministry of Defence stated in a press release.

The Defence Technology and Trade Initiative (DTTI) too made headway with the signing of a Standard Operating Procedure for implementation of projects under this framework and setting timelines with an intention to make the process outcome driven

The two sides noted their intent to explore collaboration on testing and certification in defence and aerospace sectors and establishment of Maintenance Repair and Overhaul (MRO) facilities in India. A discussion was also held on the opportunities for cooperation in India's upcoming Defence Industrial Corridors.

Acknowledging the importance of enabling agreements to power military ties, the Ministers took note of the rapid implementation of the Communications Compatibility and Security Agreement (COMCASA) and called for quick installation of secure communication capabilities between the Armed Forces, including the Armies and Air Forces. "They also decided to continue the discussion on the Basic Exchange and Cooperation Agreement (BECA) in 2020 to enable greater geospatial information-sharing," the joint statement added.

The two sides noted their intent to explore collaboration on testing and certification in defence and aerospace sectors and establishment of Maintenance Repair and Overhaul (MRO) facilities in India. A discussion was also held on the opportunities for cooperation in India's upcoming Defence Industrial Corridors

Both sides also expressed intent to initiate discussions on cyber defense issues in the coming year.

To strengthen security cooperation on international supply chain and cargo security, the Ministers looked forward to an early finalization of a Mutual Recognition Arrangement (MRA) between their Authorized Economic Operator (AEO) programs.

After the 2+2 meeting, Ministers Jaishankar and Rajanth Singh called on US President Donald Trump at the Oval Office. They were accompanied by US National Security Adviser Ambassador Robert O’Brian.

The Defence Minister also visited the Norfolk Naval Air Station on December 17 and was briefed on the naval and air assets stationed at the base.