John Kerry’s India Visit To Focus On U.S.-India Civil Nuclear Deal Hiccups, Trade Imbalances, Defense Deals

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June 24, 2013 6:36 PM EST

U.S. and Indian defense corporations are eyeing billions of dollars in military hardware deals during Secretary of State John Kerry’s three-day visit to India that began on Sunday, while Washington expects to move forward on implementing the 2008 joint civil nuclear deal, news reports said.

On his maiden visit to India as Secretary of State, Kerry is heading a high-level delegation of energy and defense officials, including Ernest Moniz, the new energy secretary, and Adm. Samuel J. Locklear III, head of the Pacific Command.

India expects to seal a $1.2 billion deal for the purchase of six additional C-130 J special operations aircraft from U.S. defense and aerospace major, Lockheed Martin Corp. (NYSE:LMT), apart from the six the company has already delivered, the Financial Times reported, quoting sources with knowledge of the matter.

India also plans to purchase $700 million worth of M777 ultra-light howitzers manufactured by BAE Systems (OTCMKTS:BAESY) in the U.S., and 22 Boeing (NYSE:BA) Apache Longbow combat helicopters, worth $1.2 billion, as well as 15 Boeing CH Chinook helicopters, worth $1.4 billion, for the Indian Air Force, the report added.

On Monday, Kerry is scheduled to attend the U.S.-India strategic dialog in New Delhi with India’s external affairs minister Salman Khurshid, before meeting Prime Minister Manmohan Singh. Kerry is also expected to meet Pallam Raju, the human resources minister, on Tuesday for talks on cooperation in higher education.

On Sunday, Kerry said the U.S. hoped to implement the U.S.-India civil nuclear deal “as soon as possible,” including realizing the efforts of nuclear energy technology firm, Westinghouse, to construct nuclear power plants in India, IANS reported.

Five years ago, while in the senate, Kerry had led a successful floor debate on the U.S.-India civil nuclear deal, but differences between New Delhi and Washington over a liability clause, which the U.S. companies believe does not safeguard their interests from possible lawsuits, have delayed the implementation.

Kerry also urged the two countries to work together to tackle climate change and develop green technologies, Reuters reported.

“We should work constructively side-by-side in the UN climate negotiations. I am convinced we can move toward a global agreement ... that is sensitive to and respectful of the diversity of national circumstances,” he said in a speech in New Delhi on Sunday. Kerry also welcomed India’s role in Afghanistan, and called on New Delhi to support the 2014 Afghan elections. 

Trade between India and the U.S. has surged five-fold in the past decade to reach more than $100 billion, with U.S. investment in India currently touching $25 billion.

Talks between Kerry and Singh are expected to focus on bilateral business and trade, in the wake of increased pressure on President Barack Obama’s administration to press India to reduce the bilateral trade imbalance.

In a letter to Obama last Tuesday, a bipartisan group of U.S. lawmakers said “policies by the Government of India to favor domestic producers over U.S. exporters,” are “inconsistent with India’s international obligations, set a bad precedent, and undermine the culture of innovation that Indian Prime Minister Manmohan Singh himself has been promoting.”

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