Washington, Sept. 18: Ahead of Prime Minister Manmohan Singh's meeting with President George W. Bush on Tuesday, the Americans have removed the Indian Space Research Organisation (Isro) from their Entity List.
The list features organisations which 'present an unacceptable risk of diversion to developing weapons of mass destruction or missiles used to deliver those weapons'.
The Americans have also modified their export licensing policies to permit 'certain exports' to India's nuclear power plants that have 'safeguarded' facilities.
The modified US licensing policies, which will also allow cooperation with India in commercial space programmes, were finalised during two days of meetings between foreign secretary Shyam Saran and several officials of the Bush administration.
The outcome of Saran's meetings here was a 'coup', an Indian official in Delhi told The Telegraph. But Saran was restrained in his enthusiasm about the agreement, not wanting to steal the Prime Minister's thunder.
A statement outlining the second phase of the Next Steps in Strategic Partnership (NSSP) between India and the US is expected to be released after Singh's breakfast meeting with Bush on Tuesday.
Isro has not only been on the Entity List since March 17, 2000: the US commerce department's Bureau of Industry and Security (BIS) has made an example of companies such as the Chyron Corporation of New York, for instance ' which exported nothing more than an animation system to Isro ' by seeking civil penalties on these companies for violation of US export control laws.
Under these laws, exports to end-users appearing on the Entity List require licences. But having to get a licence is only part of the problem: the process involves a multi-agency review within the US government which takes so long that the purpose of seeking an equipment is usually defeated for the end-user.
For Isro, the problem has been complicated because of a US decision in March 1999, which classified even satellite components as ammunition and, therefore, unavailable to Isro because of the Entity List.
Yesterday's announcement removes a major hurdle in the way of India's space and missile ambitions.
A joint statement issued at the end of Saran's meetings said 'implementation of the NSSP will lead to significant economic benefits for both countries and improve regional and global security'.
Saran said that as important as the liberalisation of the US licensing regime was the relief for Indian companies and organisations that this regime would henceforth be more predictable. 'It will make very clear to Indian public sector enterprises and private companies what precisely is expected of them in terms of meeting certain licensing conditions.'
Saran cautioned that 'you should not see it as an agreement where one side makes demands and the other gives in. This is a cooperative exercise to build confidence'.