International Trade Law News

Published by Jacobson Burton Kelley PLLC

Speaking today at the India-United States Conference on Space Science, Applications and Commerce in Bangalore, India, Under Secretary of Commerce Kenneth Juster said the easing of trade sanctions on India and the establishment of a high-technology cooperation group have led to "a dramatic and continuing increase" in the number of exports of high-technology and dual-use items to India.

Juster attributed this increase to two major recent events. First, as a result of the removal of the U.S. sanctions imposed on India in 1998 as a response to India's nuclear testing "only a very small percentage of our total trade with India is even subject to controls. The vast majority of dual-use items simply do not require a license for shipment to India." The second important event was the creation of the U.S.-India High Technology Cooperation Group in November 2002, a group that has provided a standing framework for discussing high-technology issues of mutual concern.

Juster stated that recent trade statistics with regard to dual-use items "clearly demonstrate" the steps that the U.S. Government has taken to grant India, including the Indian Space Research Organization (ISRO), expanded access to U.S. technology.

For example, he stated that in fiscal year 2002, the U.S. Government approved 423 license applications for dual-use exports to India, valued at almost $27 million. By contrast, in fiscal year 2003 -- after the High Technology Cooperation Group was established -- the U.S. approved 90% of all dual-use licensing applications for India, with the value of such approvals more than doubling to $57 million.

Juster noted that this trend has continued through the first half of fiscal year 2004. For the first half of fiscal year 2004, the U.S. approved license applications involving almost $51 million of dual-use items, which represents a year-on-year increase of nearly 80%.

Juster indicated that these same trends are occurring with regard to U.S. licensing decisions for sophisticated exports to ISRO and its subordinate entities. For example, he said that during the last year and a half, the number of licensing decisions for ISRO and its subordinates increased by 75%, with the license approval rate now running at approximately 93%, an approval rate that is even higher than for dual-use exports in general. In addition, he noted that the total value of the ISRO license approvals has risen by 55% since fiscal year 2002 to an annualized value of over $14 million for fiscal year 2004.

Finally, Juster announced that the Bush administration had recently approved a license authorizing Boeing Satellite Systems to "engage in discussions and share data with" the Indian Space Research Organization on the division of responsibilities for possible joint cooperation in the development and marketing of communication satellites.