India rejecting fighter jet deal, missing opportunity: US

India's rejection of American bids for a multibillion dollar contract to supply fighter jets was a missed opportunity to deepen defense ties and share advanced technology, a senior U.S. official said Friday.

Robert Blake, assistant secretary of state for South and Central Asia, said the United States was puzzled and "deeply disappointed" by the decision announced last month by India's Defense Ministry.

Boeing Co. and Lockheed Martin were both bidding for a slice of the $11 billion Indian deal to supply 126 fighter jets. They were among four companies passed over for what Blake described as a "once-in-a generation" acquisition. German consortium Eurofighter Typhoon and the French company Dassault Aviation have been shortlisted for the contract.

"We did see this as a strategic opportunity to really take our defense partnership to the next level and not only share advanced technology but to think in a concrete way about co-production and co-development," Blake told a seminar at the Center for Strategic and International Studies think tank in Washington.

"It appears to have been a straightforward decision made by the Indian government. We have seen no evidence of any corruption. I think our companies are prepared to move on now and pursue what opportunities are out there."

The United States has looked to expand its ties with India as part of a broader push to benefit from growing economic opportunities in Asia and to build security alliances to counteract the rise of China. President Barack Obama visited India in November and heralded the relationship between the U.S. and India, the world's two largest democracies, as a "defining partnership" of the 21st century. He threw U.S. support behind India's ambition to become a permanent member of the U.N. Security Council.

Blake said the U.S. and India have made "undeniable strides" in building their relationship in the past decade. Trade has jumped, and cooperation is growing in areas such as clean energy, science and education. The U.S. last year lifted export controls on the Defense Research and Development Organization which develops weapons and technology for India's military.

Blake said U.S. firms have won almost $4 billion in defense sales in the past four years, and would hope to benefit from the $35 billion in defense acquisitions that India is planning in the next five years.

But he said it remains hard for American exporters to gain access to Indian markets, especially in agricultural goods, and U.S. firms also face restrictions in retail, insurance and defense.

A strict Indian nuclear liability law has stymied U.S. companies' hopes of capitalizing on the Asian nation's ambitious expansion of nuclear power generation, despite 2008 a civilian nuclear deal pushed by the Bush administration that ended three decades of atomic isolation for India, allowing it access to technology it had been denied since it conducted its first nuclear explosion in 1974.

Blake said he expected the liability law to be among the wide range of issues to be discussed when Secretary of State Hillary Clinton visits India in July for a strategic dialogue.

( Source: Associated Press )
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