US elevates India’s status, will lead to better economic relationship

• India’s status has been elevated from a trading partner to Strategic Trade Authorization status (STA-1).
  
• This might make India more favourable to the Communications, Compatibility and Security Agreement (COMCASA).
  
• Strict control and licensing on the sale of high-tech defence and non-defence products between the two countries will also be eased.

On Monday, the US elevated India’s status from a trading partner to Strategic Trade Authorization status (STA-1) which is the status that it has given only to 36 countries that are largely NATO allies. India is the only south-asian country on this list.

This means that the US has eased export restrictions on high-technology product sales to India and authorises India to export, re-export and transfer (in-country) specified items. The status is very important under the US export control regime, and publicly acknowledges US-India security and economic relationship.

This will increase and speed up the sale of high-tech defence and non-defence products between the two nations, that are otherwise subjected to strict controls and licensing. India will now be able to access latest defense technologies as easily as US’ closest allies.

It might also accelerate the talk in India about signing the Communications, Compatibility and Security Agreement (COMCASA) , which is a pact that will allow high-end secured communication equipment.

It is one of the three agreements that the US has with its closest military allies and though that seems positive, India has concerns about giving away access to sensitive military communication if it signs the agreement with the US.

Interestingly, this new status for India came at a time when the country has finalised its decision to go in for a missile defence system from the US to protect parts of the capital -New Delhi.

One of the main reasons behind India's elevation could be that India and the US share an interest in countering China's expanding economic and military power. The US has become one of India’s top arms supplier, selling more than $15 billion of weapons over the past decade.