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U.S. ?trusted customer? program considered for certain Indian companies

U.S. ôtrusted customerö program considered for certain Indian companies

The U.S. Commerce Department wants to develop a 'trusted customer' program for certain Indian companies seeking to import U.S. technology, and promises fewer administrative burdens for American companies who would otherwise require a license to export to these Indian firms.

   Christopher Padilla, Commerce's assistant secretary for export administration, told reporters Wednesday that he and his staff would present the concept to Indian government officials attending the U.S.-India High Technology Cooperation Group (HTCG) meetings in Washington this week. These meetings are part of the Bush administration's efforts to foster a strategic partnership between the United States and India.

   Commerce's trusted customer program is modeled after the 'validated end-user' (VEU) program regulations, which the department proposed in July 2006. The VEU program is designed to reduce export control restrictions for certain approved Chinese companies seeking U.S. technologies. The proposed program rules, however, came under fire from numerous industry groups during the comment period and are under interagency review.

   Unlike China, most export license requirements have been eliminated for U.S. exports to India. Last year, Commerce's Bureau of Industry and Security processed about 800 license requests for India-bound U.S. exports. Export licenses are generally required for so-called 'dual use' items, which are identified to have both commercial and military applications.

   Padilla said the department has picked a 'number of candidates' among India's industry to try out the trusted customer program, but would not elaborate further. If necessary, he said the Commerce Department does have the authority to seek a separate rulemaking for the Indian trusted customer program.

   During the HTCG meetings, Commerce officials will also work with their Indian counterparts to identify 'vestiges' of Cold War export controls and consider ways to eliminate them.

   Padilla said there's still 'a perception in India that sanctions are hindering high-tech trade' with the United States, based on sanctions from the late 1990s when India and Pakistan threatened each other with nuclear war. These sanctions were lifted by the United States several years ago. Today, only 1 percent of U.S. exports to India require a Commerce Department license, Padilla said.

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