Roundtable on Advancing India-US Initiative on Critical and Emerging Technologies (iCET) | PTI
“iCET is about much more than technology cooperation, it’s a platform to accelerate our strategic convergence and policy alignment”.1
Background
The above statement by Jake Sullivan, a year ago, ahead of the launch of the India-US Initiative on Critical and Emerging Technologies (iCET), underlines the overall theme of creating iCET as a new pillar of India-US relationship. This pillar is now substantially complementing defense and security as the vital pivot of India’s ties with the US.
Since its inception in May 2022, at Tokyo, to the first formal dialogue on January 31, 2023, between the two National Security Advisors (NSAs), vested with the responsibility of steering the initiative; followed in quick succession by two summit level meetings between the Indian PM Modi and US President Biden, in June and September, 2023, iCET has achieved an accelerated momentum and tops the multifaceted cooperation agenda between the two countries. The range of stakeholders now extends well beyond the two governments and defense establishments, to include business, investors, innovators, educators, think tanks and more.
The scope, which initially included cooperation in verticals of semiconductors, Artificial Intelligence (AI), space, next generation telecommunication, quantum, high performance computing and Defence innovation has now been enlarged.
During the midterm review held at the level of Deputy NSAs in early December 2023, the two sides agreed to include biotechnology, critical minerals and rare earth processing technologies, digital connectivity, digital public infrastructure, and advanced materials.
Aim
The aim of India-US technology cooperation, from the US perspective, is appreciated to be, `to harness Indian talent, to accelerate technology advancements and broaden innovation base, through co-research and co-development; making its supply chains resilient; leveraging India’s large civil and defense market, to achieve economies of size and scale; with the overall intent to strengthen multifaceted strategic partnership’. For India, the partnership is ‘aimed at attracting investments, acquiring cutting edge technology and skills, creating opportunities for innovators and entrepreneurs, obtaining access to advanced R&D facilities, integrating in global value chains, job creation, and economic growth’.
A vital aim for India is also to orient this partnership for achieving greater self-reliance and developing capabilities for national defense and regional stability, against ongoing hegemonic assertions. This can be done by harnessing the growing overlap between the civil and military R&D with dual use, commercial and military applications. This is where iCET attains a distinct edge over solely defense focused Defence Technology and Trade Initiative (DTTI).
Review of First Year Activities
With the focus of bilateral partnership on iCET, the existing arrangements of DTTI, Defence Industrial Road map, and INDUS-X (India-US Defense Acceleration Ecosystem) have now got dovetailed into each other. Of the fields identified, the most notable collaborative activities have been in the field of semiconductors, INDUS-X, and space as highlighted below.
Semiconductors
Semiconductor supply chain partnership is guided by a Memorandum of Understanding (MoU) to create a `complementary semiconductor ecosystem.’ Facilitating exchange of technologies and capital are the primary areas of focus. A number of US industries had announced investment plans in India, in June and September 2023. These include: Micron Technology, Inc. ($ 825 million) for setting up a collaborative $ 2.75 billion assembly and test facility; Lam Research, for virtually training 60, 000 engineers; Applied Materials, Inc. ($ 400 million) for establishing a collaborative engineering center in India2; Micro Chip Technology, Inc. ($ 300 million) to enhance R&D presence; and Advanced Micro Devices ($ 400 million) to expand R&D and engineering operations in India3.
Of these, Micron Technology has already done the ground breaking ceremony for its facility, at Sanad in Gujrat in September and the design center of Advanced Micro Devices was inaugurated at Bengaluru in November 2023.
The net outcomes from above include: creation of R&D and engineering centers in India, training of high demand skilled human resources for semiconductor industry (requirement of approximately 350,0004 personnel over the next decade, with 70,000 to 90,000 required once the new semiconductor fabs currently being planned become operational5), inbound investments, incubation of ancillary companies supporting fabrication, laying foundation for `outsourced semiconductor assembly and test (OSAT’) and `System in Package (SIPs)’ facilities over the next few years, entry into global supply chains, and creation of direct and indirect jobs.
INDUS-X
The other area of intense engagement is the INDUS-X. The initiative is designed to be an “Innovation Bridge” to connect U.S. and Indian defense start-ups, in which the activities are directed at expanding the strategic technology partnership and defense industrial cooperation between the governments, industry, and academic institutions.
Academic partnership arrangements have been instituted between the Council of Indian Institutes of Technology (IIT Council) and the Association of American Universities (AAU). The two are looking at jointly setting up the India-US Global Challenges Institute to advance new frontiers in science and technology, in diverse fields. Joint programmes between various academic institutions have been conducted, including between IIT Kanpur and Pennsylvania State University, and M/s Hacking 4 Allies (H4X) and IIT Hyderabad. The latter conducted a Joint Accelerator Programme for startups.
Joint innovation challenges, under INDUS-X, `Mutual Promotion of Advanced Collaborative Technologies (IMPACT)’ programme have been identified jointly by the `Innovations for Defence Excellence (iDEX)’ of the Ministry of Defence (MoD India) and Defence Innovation Unit (DIU) of the U.S, Department of Defence (DoD). These relate to the domains of underwater communications and oil spill detection. Startups have been invited to participate in both fields, and the selection process is underway.
Other initiatives launched under the INDUS-X programme include: educational series (Gurukul), to orient and guide start-ups in both countries of each other’s systems and processes; a mentor-protégé programme; creation of a joint innovation fund (akin to US- India Science and Technology Endowment Fund). Some of these ideas were discussed recently at INDUS-X Investors meet held at New Delhi on November 8, 2023.6
The initiative has intensified focus on identifying scientific talent, to meet the current and future national security challenges. It is helping to create a collaborative partnership base between the innovators, start-up companies, investors, arms majors, and the armed forces (users).
Space
Substantial cooperation activities are also being undertaken in the field of Space, in both civilian and military domains. For commercial space collaboration, a sub-working group on `space-commerce’ has been set-up under the existing India-US Civil Space Joint Working Group (JWG) led by National Aeronautics and Space Administration (NASA) and Indian Space Research Organisation (ISRO). India is also set to join the multilateral Space Mission Planning Advisory Group (SMPAG) and International Asteroid Warning Network (IAWN), with the Space JWG now discussing issues related to ‘Planetary Defence.’
This arrangement would give India a say in evolving norms for space exploration. India has also joined the Artemis Accord for joint space exploration with the US, altering its earlier approach of working with a group of 21, largely non-aligned countries, insisting on a multilaterally-negotiated legally binding verifiable mechanism. This choice has been preferred over joining the `Joint Russia-China International Lunar Research Station’ for strategic reasons.7
Looking at the programmes for the year 2024, both sides are finalizing a strategic framework for human spaceflight cooperation; a Joint mission to the International Space Station; and launching NISAR (NASA – ISRO Synthetic Aperture Radar) Satellite. In the military field, a bilateral Advance Domain Defence Dialogue (AD3) has been initiated since May 2023, to address issues related to space and AI. An area of mutual interest is that of space situational awareness and security of national space assets.
With these initiatives, impetus has been accorded to technology and commercial collaboration between the US and Indian public and private sectors in the entire value chain of space economy. NASA (National Aeronautics and Space Administration) Administrator Bill Nelson, during his visit to India in November 2023, discussed collaboration between ISRO, NewSpace India Ltd (commercial arm of ISRO), Larsen & Toubro (L&T), on the Indian side, and NASA, Blue Origin (Jeff Bezos' space company), Voyager Space, and others on the US side, for use of Indian rockets to launch small satellites. Boeing is also in the process of designing and manufacturing space capsule simulators for India’s lunar spacecraft project.8 This opens avenues for easing technology sharing regulations.
Other Fields
Collaborative activities are also being undertaken in other verticals. In the field of Defence, with completion of Congressional notification in August 2023, commercial negotiations are underway between GE Aerospace and Hindustan Aeronautics Ltd (HAL) for co- production of GE-414 Jet engines in India with substantial transfer of technology. In the telecommunications sector, Joint task forces are working out collaboration in the field of Open RAN (Radio Access Network) and development of 5G/6G technologies. Collaborative activities have also been initiated in the Quantum domain, AI and for development of next generation small modular reactor technologies. Google, through its investment in India Digitization Fund and Research Center is building AI models to support 100 Indian languages.
The collaborative activities are being steered through various dialogues: the Strategic Trade Dialogue, Commercial, Defence Policy, and the 2+2 Dialogues. In addition, Joint Working Groups (JWGs) and Task forces (TFs) have been set up for each vertical to progress the identified activities. An inter-agency monitoring mechanism has also been created under the auspices of the bilateral `Strategic Trade Dialogue’.
Looking Ahead
There is a distinct realization on both sides that iCET is a transformative step, with some considering it at the level of the India-US civil nuclear deal. The first year of its operationalization has witnessed intense activity, with some progress being made in areas that are relatively easy to navigate. Investments committed in the field of semiconductors have started flowing in and the initial work for infrastructure development has also commenced.
The US industry, in collaboration with the Indian side, has started establishing research and engineering centers; initiated hi-tech skilling programmes, establishing facilities for assembly, testing and packaging. This has triggered the growth of the Indian semiconductor industry, employment generation in hi-tech jobs, inclusion of Indian industry in global supply chains, and creation of an ecosystem of ancillaries.
Alongside, intense efforts are underway through programmes like INDUS-X, `Innovation-handshake,’ hackathons, innovation challenges, and academic interaction, to spot talent, to mentor them and to fund the innovators and startup entrepreneurs, to promote their activities.
The portents for continued inflow of investments, promotion of talent, generation of high skill jobs and the growth potential for industry in these areas appear bright. In the short term, for a labor abundant country like India, with moderate educational/ skill standards, these outcomes are substantial and should be welcome. In the long term, however, India, with its immense potential and aspirations of self-reliance cannot remain permanently slotted as a component/ skilled labor supplier or a low tier partner in the value chain.
The vision of iCET partnership needs to be such that the Indian skills are combined with US compute power and the benefits of co-developed technology also flow into India, commensurate to the benefits of trade accruing to its partners. There is a need to be mindful that short term business interests do not always support long term strategic interests. The endeavor should be to progressively build partnerships at upper ends of the value chain, sharing Intellectual Property Rights (IPRs) and application benefits, in commercial applications and for Defence capability development.
The process would of course be evolutionary and long drawn, and would need to be supported by assured collaborative funding. The multifaceted cooperation, with multiple stakeholders, united by their investments, technology partnerships, inter-linked supply chains would ultimately provide the necessary ballast and momentum to this relationship.
Prudence also lies in making the expectations realistic and aligning these to pragmatic timelines, which would be long. Towards this, the two years (plus) long journey of forging technology partnership between the US, UK, and Australia, under AUKUS Pillar 2 is illustrative. Despite the countries being allies and Five Eyes network intelligence sharing partners, existence of a dedicated Congressional working group on AUKUS, active involvement of all branches and various departments in the US government, the challenges related to overcoming regulatory barriers of the US Defence Export Control regime persist.
Even a generic comparison of the contents of the two bills related to AUKUS (HR 1093- To direct the Secretary of State to submit to Congress a report…9 and S-1471- Truncating Onerous Regulations for Partners and Enhancing Deterrence Operations (TORPEDO) Act of 202310 ); and one bill related to India (HR-5374- Technology Exports to India Act11), presently under deliberation in the US Congress, would give an idea of the arduous journey ahead for dismantling technology sharing barriers. Likewise, there would be challenges on the Indian side to align its regulations and acquisition process to the US norms and create a predictable regulatory environment.
iCET is a bold initiative, with potential for a quantum leap in India-US relationship. It has also attained the desired momentum since its inception. To sustain this, some additional aspects to be considered are:
a. A robust internal and bilateral coordination mechanism due to multiple agencies involved on both sides. Guidance with overall strategic perspective, beyond technical intricacies involved.
b. 'Formalize’ the progress made under iCET to maintain continuity beyond individuals/ administrations involved. The experience of Formalising Major Defence Partner (MDP) status for India, through National Defense Authorization Act (NDAA), 2017 is relevant.
c. Guard against the repeat experience of setting unrealistic trade and technology transfer expectations, and short-term commercial interests overtaking long term strategic convergence.
d. A realistic appraisal of International Traffic in Arms Regulations (ITAR) regulations and export control restrictions on the US side and acquisition procedures on the Indian side, mindful of worldwide proliferation of technology and alternative sources available.
Ability to partner each other in an environment of both sides dealing with multiple partners (e.g. India’s legacy relations with Russia and US’s relations with Pakistan). This should be based on developing trust to maintain exclusivity of relationship, without being detrimental to other partner’s interests. A challenging proposition no doubt!
e. Need for concurrent focus on both sides on aligning National Defence Science and Technology strategy, for capability development.
f. An endeavor to produce some early `demonstrable results,’ to sustain momentum of engagement.
(Exclusive to NatStrat)
References:
Sharmila Kantha
