Strategic Trade Authorisation

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Context: 

  • Recently the US has given India Strategic Trade Authorisation-1 status.

About Strategic Trade Authorisation (STA)

  • STA allows for license exception with regards to exports from the US. This type of US government authorisation allows a certain item to be exported under defined conditions without a transaction-specific license.
  • Items eligible for export to STA-1 nations include those under control for national security, chemical or biological weapons, nuclear non-proliferation, regional stability, crime control.
  • The categories also include electronics, lasers and sensors, information security, computers and electronics, navigation, telecommunications, aerospace, etc.

Importance of the status:

  • The move means that India can get easy access to latest defence technologies, with the reduction of the number of licenses needed for exports from the US.
  • It is also a boost for the foundational Communications, Compatibility and Security Agreement (COMCASA).
  • STA-1 provides India with greater supply chain efficiency, both for defence, and for other high-tech products.
  • The status eases export controls for high technology product sales to India, granting it the same access as NATO allies — Australia, Japan and South Korea.

India and US relation:

  • India and the United States share an interest in countering China’s expanding economic and military weight and the United States has emerged as a top arms supplier to India, selling more than $15 billion of weapons over the past decade as New Delhi modernizes its Soviet-era military.
  • Looking at current exports from the US to India, 50% of those are eligible now under STA-1. This can free up $2.1 billion in trade, make US exporters more competitive in the global marketplace, help provide India more advanced US technology.
  • India is the only South Asian nation on the STA-1 list that has 36 countries. Other Asian countries designated as STA-1 are Japan and South Korea. Till recently, India was classified as an STA-2 country along with seven others.

Source:TH