Ending the licence raj in India-US strategic ties

For India, navigating US export controls remains a challenge 20 years since the civilian nuclear agreement was signed

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As we approach the 20th anniversary of the US-India civilian nuclear agreement, it is worth reflecting on both the progress made and continuing challenges to India’s navigation of US export controls.

A major rationale for the 2005 nuclear agreement was to enable India to access strategic technologies from the US and its allies. Further reducing or harmonising export controls remains crucial both for strategic cooperation and for US and Indian businesses working in a variety of sensitive sectors — defence, aerospace, semiconductors, quantum, space, and chemical and biotechnologies — that generally require an export licence from a relevant government agency.

At face value, tremendous progress has been made in India’s ability to access leading-edge technologies. Since the 1970s, India was at the receiving end of discriminatory US export controls on account of its nuclear weapon programme and close defence relationship with the Soviet Union. Despite a bilateral high technology arrangement being initiated in the 1980s, India’s nuclear weapon programme and 1998 tests resulted in US sanctions. The US took various measures against India that included suspending defence sales, denying the Indian government credit and loans, and denying visas for Indian scientists. By the late 1990s, about a quarter of US exports to India by value required a licence.