In a major boost for the Indian defence industry, the US and India have signed a pact to enable the secure transfer of classified critical defence technology.

The Industrial Security Annex (ISA) agreement was signed by India External Affairs Minister S Jaishankar, Defence Minister Rajnath Singh, US Secretary of State Mike Pompeo and Defence Secretary Mark Esper during the second round of 2+2 dialogue between the two countries.

The ISA sets the stage for Indian and US private companies to pursue joint development and production in the defence sector.

The deal is critical for any country seeking technology transfer from the US.

India and the US also reached three agreements under the Defense Technology and Trade Initiative to boost the combined capacity for the co-production of critical technologies.

In a press briefing, Mark Esper said: “We are proud to conclude the Industrial Security Annex, which will facilitate collaboration between our defence industries by supporting the secure transfer of key information and technology.”

The meeting in Washington DC, US, also saw the Indian Ministry of Defence calling for greater investment by US companies to support development and production of defence equipment in India under the government’s ‘Make in India’ initiative.

Rajnath Singh said: “In the last few years, we have made a conscious decision to diversify and indigenise our arms acquisitions. This increased defence trade with the US is one important aspect of this. We are also working to encourage greater collaboration between defence manufacturing sectors in India and the US.”

Other highlights of the dialogue include a commitment to expanding military-to-military cooperation and maritime partnership.

The two countries agreed to conduct the bilateral tri-service amphibious military Tiger Triumph exercise next year. It was launched this year and involved the Indian army, navy and airforce.

India and the US held the first 2+2 dialogue in New Delhi in September last year.