U.S., India nuclear deal still pending
U.S. Secretary of Defense Robert Gates wraps up a two-day visit to India, with a focus on a nuclear and fighter jet deal. Doug Krizner asks Mehul Srivastava of MINT what's at stake for American companies.
U.S. Secretary of Defense Robert Gates inspects the troops during a changing of the guard ceremony at the Defence Ministry in New Delhi, India. (Mark Wilson/Getty Images)
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TEXT OF INTERVIEW
Doug Krizner: To India, where Defense Secretary Robert Gates is wrapping up a two-day visit. Part of his trip has been about drumming up business for U.S. military and nuclear suppliers. Two years ago, India bought $6 billion worth of defense equipment, mostly from Russia. Now, the U.S. is trying to become the primary source.
Let's go to Delhi and bring in Mehul Srivastava, he's a business reporter at the news publication MINT. Mehul, what is the secretary trying to achieve.
Mehul Srivastava: Well, Defense Secretary Gates' visit over here in India, it revolves around two specific issues. One is a still pending agreement between the Indians and the Americans to sign a nuclear deal. And the second is an upcoming contract for about $10 billion for the Indians to buy about 126 fighter jets that they need to put in the air force. Now, the American companies that are in the running for the fighter jet are Boeing company and Lockheed Martin. But they're competing with the Russians and with two European companies that also make similar fighter jets.
Krizner: Now, in terms of the nuclear deal, how close are they on an agreement?
Srivastava: You know, the agreement's basically been stalled on the Indian side. The agreement, it's a complex one, because India never signed a non-proliferation treaty. American companies, and European companies for that matter, are blocked from doing business with the Indian nuclear establishment. President Bush came up with the "1, 2, 3" agreement, which is what it's called right now, in which in exchange for allowing international observers into the civilian nuclear plants in India, Indian companies would then be able to buy nuclear technology from American companies. But when this issue first came up, opposition to it was pretty severe.
Krizner: In terms of what's at stake for American companies, do you have a sense of how big a piece of the pie we're talking about?
Srivastava: I mean, between the nuclear deal and the fact that the Indian military's buying a huge amount of equipment in the next 10 to 15 years, there could be close to $100 billion at play over here.
Krizner: Mehul Srivastava is a reporter for the business publication MINT in Delhi. Mehul, thanks so much for speaking with us.
Srivastava: Thanks for having me.
