White House Releases Fact Sheet on US India Strategic Technology Collaboration

The White House released a Fact Sheet outlining collaboration efforts concerning national security and technology with India on January 6, 2025.  The Fact Sheet states in relevant part:

Today, U.S. National Security Advisor (APNSA) Jake Sullivan met with Indian National Security Advisor (NSA) Ajit Doval, Indian External Affairs Minister S. Jaishankar, and Prime Minister Modi in New Delhi as the United States and India continue to forge a strategic technology partnership that benefits both of our countries and our partners around the world.  APNSA Sullivan and NSA Doval launched the U.S.-India initiative on Critical and Emerging Technology (iCET) in 2022 at the direction of President Biden and Prime Minister Modi.  In the intervening years, our two nations have taken significant steps forward together to integrate our technology and defense supply chains in recognition that, now more than ever, we need to work with our partners to build a trusted and resilient innovation base.

During their capstone meeting, APNSA Sullivan and NSA Doval underscored the vital importance of our efforts to jointly produce and develop strategic technologies that will allow us to deliver secure, reliable, and cost-competitive technology solutions for the world. As the United States and India deepen collaboration across key sectors – from space to semiconductors, biotechnology, cybersecurity, advanced telecommunications, and clean energy – we have seen the promise of our partnership deliver results.  Our partnership has also anchored multilateral work with like-minded nations from across the Indo-Pacific and Europe, including the Bio-5 Biopharmaceutical Supply Chain Consortium, the U.S.-India-ROK Technology Trilateral, and ongoing cooperation with Australia and Japan through the Quad.

Finally, APNSA Sullivan and NSA Doval reaffirmed our shared resolve to adapt and strengthen our technology protection toolkits and discussed efforts to address national security concerns associated with overcapacity in key technology sectors.  At the same time, they commended the progress we have made to address long-standing barriers to bilateral strategic trade, technology, and industrial cooperation.

The two national security leaders expressed their confidence that the bridges we have built across our governments, industry, and academia will endure and reflected on the significant achievements we have driven across every dimension of the technological enterprise – from the seabed to the stars, and beyond.  This includes:

Launching a New Era in Space Technology Cooperation

• Announcing the first-ever joint effort between American and Indian astronauts at the International Space Station with the launch of Axiom-4 scheduled to take place this spring, which will mark a significant milestone in the U.S.-India human spaceflight partnership and space exploration; 
• Reducing barriers to collaboration around commercial space technology following the U.S. government’s recent conclusion of updates to Missile Technology Control Regime export policy, which will open the door to additional technology licensing and co-development opportunities in support of the U.S.-India space partnership;
• Working toward the launch of a new bilateral space accelerator to promote commercial space cooperation, including around lunar exploration, human spaceflight, geospatial data and services, and the co-development of technology;
• Celebrating the conclusion of a Strategic Framework for Human Spaceflight Cooperation to deepen interoperability in space and working toward the imminent completion of additional agreements to commence advanced training for ISRO astronauts and ground personnel at the NASA Johnson Space Center and for joint experiments at the International Space Station;
• Preparing for the launch of the NASA-ISRO Synthetic Aperture Radar, a jointly developed satellite that will map the entirety of the Earth’s surface twice every 12 days as the United States and India work together to combat climate change and other global challenges, this spring;
• Deciding to hold the first bilateral experts’ exchange on space situational awareness and space traffic coordination in the first half of this year.  This exchange builds upon the two nations’ shared commitment to pursue opportunities for deeper collaboration to ensure safe and sustainable space operations;
• Exploring additional avenues for cooperation in space exploration technologies, including docking and interoperability demonstration missions, as well as India’s participation in the United States Traffic Coordination System for Space program. 

Deepening Defense Innovation and Industrial Cooperation

• Welcoming the advancement of discussions between Ultra Maritime and Bharat Dynamics Limited to enhance undersea domain awareness through a first-of-its-kind partnership on co-production of U.S. sonobuoys in support of the U.S. and Indian defense industrial bases;
• Welcoming India’s acquisition of the MQ-9B platforms, the possible co-production of land warfare systems, and progress on other co-production initiatives outlined in the U.S.-India Roadmap for Defense Industrial Cooperation;
• Celebrating the third edition of the India-U.S. Defense Acceleration Ecosystem (INDUS-X) Summit which took place at Stanford University in September 2024, and highlighting the continued progress under INDUS-X, including the Gurukul Educational Sessions and the launch of a third joint challenge on space situational awareness in low earth orbit;
• Welcoming the completion of an upgraded Memorandum of Understanding between the Defense Innovation Unit and the Defense Innovation Organization to expand cooperation on defense innovation and deepen collaboration between the U.S. and Indian startup ecosystems;
• Deepening cooperation between the U.S. Defense Innovation Unit and India’s Innovations for Defense Excellence to accelerate the joint adoption of cutting-edge commercial technologies for military solutions and capability enhancement of both countries’ defense ecosystems;
• Noting continued progress in the discussions between GE Aerospace and Hindustan Aeronautics Limited for the co-production of GE F414-INS6 engines to power India’s future fighter fleet;
• Expanding defense industrial partnerships, such as the launch of an AI Multi-Doman Situational Awareness product jointly developed by General Atomics and 114ai to support joint all domain command and control.

Building a Clean Energy and a Critical Minerals Partnership for the 21^st Century

• Advancing discussions to unlock new commercial partnerships around the deployment of small modular reactor technology in India;
• Reflecting the progress the United States and India have made—and will continue to make—as strategic partners and countries with a shared commitment to peaceful nuclear cooperation, NSA Sullivan announced US efforts to finalize necessary steps to delist Indian nuclear entities, which will promote civil nuclear cooperation and resilient clean energy supply chains;
• Commending the signing of a bilateral Critical Minerals Memorandum of Understanding between the U.S. Department of Commerce and the Indian Ministry of Commerce and Industry and the Ministry of Mines, and driving additional areas of cooperation in critical mineral supply chains such as for graphite, gallium, and germanium;
• Advancing collaboration between U.S. and Indian organizations and companies for carrying out research studies for beneficiation and co-development of processing technologies for critical minerals, including lithium, titanium, gallium, and vanadium;
• Building a collaborative program between the Geological Survey of India and the U.S. Geological Survey on exploration, characterization and evaluation of rare earth elements and critical mineral deposits.

Promoting Strategic Semiconductor Supply Chain Partnerships

• Advancing a strategic semiconductor partnership between the U.S. Space Force and 3rdiTech to establish a compound semiconductor fabrication plant in India to manufacture infrared, gallium nitride, and silicon carbide semiconductors that will be used in national security-relevant platforms; this includes favorably reviewing a technical assistance agreement and export licenses to promote technology transfers;
• Building on the U.S.-India Semiconductor Supply Chain and Innovation Partnership MOU and promoting secure, resilient, and sustainable semiconductor supply chains through continued collaboration between the U.S. Department of Commerce and the India Semiconductor Mission, Ministry of Electronics and Information Technology including facilitating investments in semiconductor manufacturing and strengthening R&D collaboration around state-of-the-art semiconductor and packaging technologies.

Building New Collaboration around AI, Advanced Computing, and Quantum

• Developing a government-to-government framework for promoting reciprocal investments in AI technology and aligning protections around the diffusion of AI technology;
• Strengthening cooperation around the national security applications of AI, following the U.S. government’s recent issuance of a National Security Memorandum on AI last fall, and promoting safe, secure, and trustworthy development of AI;
• Noting the importance of sustained engagement for cooperation on Quantum Information Science and Technology (QIST) as agreed to in the second meeting of the U.S.-India Quantum Coordination Mechanism held last August, during which both countries committed to achieving concrete outcomes;
• Initiating new cooperation in quantum science and technology, including through a workshop on post-quantum cryptography and quantum hardware held at the University of California, Los Angeles in September 2023 and facilitating visits of Indian technical experts from academia and the private sector to visit U.S. national laboratories and quantum institutions.

Bridging our People, Talent, and Innovation Bases

• Celebrating progress toward opening U.S. Consulate Bengaluru in early 2025 and continuing work to establish new Indian Consulates in Boston and Los Angeles;
• Advancing a “Bio-X” initiative that would promote biotechnology cooperation by leveraging the synergies between domestic programs and enhancing the competitiveness of the biotechnology industries in both countries;
• Celebrating steps that expand of the ability of top AI scientists, engineers, and entrepreneurs from India to come to the United States, including rulemaking that modernized the U.S. H-1B application process, recent clarifications of the rules for O-1 visas and other visa categories, and other efforts that have streamlined visa processing;
• Noting the recently launched U.S.-India Advanced Materials R&D Forum, which convened its inaugural meeting in November 2024, to expand collaboration between U.S. and Indian universities, national laboratories, and private sector researchers.

Kerrigan on The Financing of Intangible Assets

In an ambitious and relatively short book (290 pages) titled, "The Financing of Intangible Assets: TMT Finance and Emerging Technologies" (LexisNexis), editor and author Charles Kerrigan of CMS law provides a treatment of financing of intangible assets in the technology, media and telecom sectors.  The book has wide breadth and selective depth in its coverage of the subject matter.  Moreover, it is a practical book which discusses mitigating risk and anticipating potential issues, including focusing on potential problems that may arise with new and emerging technology.  The book first opens with five chapters that provide an overview of various relevant agreements and the role of players in the field.  The second part covers security and regulation, such as “Taking Security over Intellectual Property Rights,” and “Restrictions on Assignment, Floating Charges.”  The next ten chapters cover financing in various industries, including Software, Telecoms, Gambling, Music, Biotech and Healthtech, Publishing, Advertising and Adtech, Technology, TV Broadcast Media and Media Technology, and Film.  The next ten chapters ambitiously highlight specific countries’ law concerning the subject matter, which are each authored by practitioners from those respective countries, or Mr. Kerrigan in collaboration with law firms in the geographic area.  Finally, the book ends with ten chapters generally dedicated to an area of new technology involving finance, such as Digital Money, Blockchain and Artificial Intelligence.  This book is helpful as a resource for those who desire an overview of the field and those who need a relatively detailed treatment of a specific area.  It is a welcome addition to the resources concerning the topic.

A Greater Appreciation for the Contribution and Value of Some Intangibles (particularly "free" intangibles)?

In a recent speech titled, “Trucks and Terabytes: Integrating the 'Old' and 'New' Economies,” at the 61st Annual Meeting of the National Association for Business Economics, Federal Reserve Chairman Jerome H. Powell challenged the underlying data concerning measurements of economic growth.  He asks: “with terabytes of data increasingly competing with truckloads of goods in economic importance, what are the best ways to measure output and productivity? Put more provocatively, might the recent productivity slowdown be an artifact of antiquated measurement?”  In considering the question, here are his comments: 

How Should We Measure Output and Productivity?
Let's now turn to the second question of how to best measure output and productivity. While there are some subtleties in measuring oil output, we know how to count barrels of oil. Measuring the overall level of goods and services produced in the economy is fundamentally messier, because it requires adding apples and oranges—and automobiles and myriad other goods and services. The hard-working statisticians creating the official statistics regularly adapt the data sources and methods so that, insofar as possible, the measured data provide accurate indicators of the state of the economy. Periods of rapid change present particular challenges, and it can take time for the measurement system to adapt to fully and accurately reflect the changes in the economy.

The advance of technology has long presented measurement challenges. In 1987, Nobel Prize–winning economist Robert Solow quipped that "you can see the computer age everywhere but in the productivity statistics."⁶ In the second half of the 1990s, this measurement puzzle was at the heart of monetary policymaking.⁷ Chairman Alan Greenspan famously argued that the United States was experiencing the dawn of a new economy, and that potential and actual output were likely understated in official statistics. Where others saw capacity constraints and incipient inflation, Greenspan saw a productivity boom that would leave room for very low unemployment without inflation pressures. In light of the uncertainty it faced, the Federal Open Market Committee (FOMC) judged that the appropriate risk‑management approach called for refraining from interest rate increases unless and until there were clearer signs of rising inflation. Under this policy, unemployment fell near record lows without rising inflation, and later revisions to GDP measurement showed appreciably faster productivity growth.⁸

This episode illustrates a key challenge to making data-dependent policy in real time: Good decisions require good data, but the data in hand are seldom as good as we would like. Sound decisionmaking therefore requires the application of good judgment and a healthy dose of risk management.

Productivity is again presenting a puzzle. Official statistics currently show productivity growth slowing significantly in recent years, with the growth in output per hour worked falling from more than 3 percent a year from 1995 to 2003 to less than half that pace since then.⁹ Analysts are actively debating three alternative explanations for this apparent slowdown: First, the slowdown may be real and may persist indefinitely as productivity growth returns to more‑normal levels after a brief golden age.¹⁰ Second, the slowdown may instead be a pause of the sort that often accompanies fundamental technological change, so that productivity gains from recent technology advances will appear over time as society adjusts.¹¹ Third, the slowdown may be overstated, perhaps greatly, because of measurement issues akin to those at work in the 1990s.¹² At this point, we cannot know which of these views may gain widespread acceptance, and monetary policy will play no significant role in how this puzzle is resolved. As in the late 1990s, however, we are carefully assessing the implications of possibly mismeasured productivity gains. Moreover, productivity growth seems to have moved up over the past year after a long period at very low levels; we do not know whether that welcome trend will be sustained.

Recent research suggests that current official statistics may understate productivity growth by missing a significant part of the growing value we derive from fast internet connections and smartphones. These technologies, which were just emerging 15 years ago, are now ubiquitous (figure 3). We can now be constantly connected to the accumulated knowledge of humankind and receive near instantaneous updates on the lives of friends far and wide. And, adding to the measurement challenge, many of these services are free, which is to say, not explicitly priced. How should we value the luxury of never needing to ask for directions? Or the peace and tranquility afforded by speedy resolution of those contentious arguments over the trivia of the moment?

Researchers have tried to answer these questions in various ways.¹³ For example, Fed researchers have recently proposed a novel approach to measuring the value of services consumers derive from cellphones and other devices based on the volume of data flowing over those connections.¹⁴ Taking their accounting at face value, GDP growth would have been about 1/2 percentage point higher since 2007, which is an appreciable change and would be very good news. Growth over the previous couple of decades would also have been about 1/4 percentage point higher as well, implying that measurement issues of this sort likely account for only part of the productivity slowdown in current statistics. Research in this area is at an early stage, but this example illustrates the depth of analysis supporting our data-dependent decisionmaking.

The full speech is available, here.  The paper concerning measuring value using volume of data, titled, "Accounting for Innovations in Consumer Digital Services: IT Still Matters," is available, here.  

US Treasury Department CFIUS Proposed Regulations Released

The U.S. Treasury Department has recently issued new regulations for review concerning the Committee on Foreign Investment in the United States (CFIUS).  CFIUS reviews transactions implicating national security concerns.  The Fact Sheet concerning the new proposed regulations from the U.S. Treasury Department states: 

FIRRMA Provisions on Non-Controlling Investments

FIRRMA expands CFIUS’s jurisdiction beyond transactions that could result in foreign control of a U.S. business to also include a non-controlling investment, direct or indirect, by a foreign person that affords the foreign person: 

access to any material nonpublic technical information in the possession of the U.S. business;  membership or observer rights on the board of directors or equivalent governing body of the U.S. business or the right to nominate an individual to a position on the board of directors or equivalent governing body; or any involvement, other than through voting of shares, in substantive decisionmaking of the U.S. business regarding— the use, development, acquisition, safekeeping, or release of sensitive personal data of U.S. citizens maintained or collected by the U.S. business; the use, development, acquisition, or release of critical technologies; or the management, operation, manufacture, or supply of critical infrastructure.  

This new authority only applies to a non-controlling investment in a U.S. business that:  produces, designs, tests, manufactures, fabricates, or develops one or more critical technologies;   owns, operates, manufactures, supplies, or services critical infrastructure; or maintains or collects sensitive personal data of U.S. citizens that may be exploited in a manner that threatens national security.

FIRRMA also requires that CFIUS prescribe regulations that further define the term “foreign person” in the context of non-controlling investments by specifying criteria to limit its applicability over certain categories of foreign persons.

Key Aspects of the Proposed Regulations Regarding “Covered Investments”

Types of investments covered:  Non-controlling investments that afford a foreign person certain access, rights, or involvement in certain U.S. businesses (referred to as “covered investments”).

Largely a voluntary process:  Process remains largely voluntary, where parties may file a notice or submit a short-form declaration notifying CFIUS of a covered investment in order to receive a potential “safe harbor” letter (after which CFIUS does not initiate a review of a transaction except in certain limited circumstances).  In some circumstances, filing a declaration for a transaction is mandatory.  In particular, FIRRMA creates a mandatory declaration requirement for specified covered transactions where a foreign government has a “substantial interest”.  Additionally, FIRRMA authorizes CFIUS to mandate declarations for covered transactions involving certain U.S. businesses that produce, design, test, manufacture, fabricate, or develop one or more critical technologies.  

U.S. businesses covered:  The new provisions on covered investments only apply to investments in U.S. businesses involved in specified ways with critical technologies, critical infrastructure, or sensitive personal data—referred to as “TID U.S. businesses” for technology, infrastructure, and data.  

 Critical technologies:  CFIUS may review transactions related to U.S. businesses that design, test, manufacture, fabricate, or develop one or more critical technologies.  “Critical technologies” is defined to include certain items subject to export controls and other existing regulatory schemes, as well as emerging and foundational technologies controlled pursuant to the Export Control Reform Act of 2018.  

 Critical infrastructure:  CFIUS may review transactions related to U.S. businesses that perform specified functions—owning, operating, manufacturing, supplying, or servicing—with respect to critical infrastructure across subsectors such as telecommunications, utilities, energy, and transportation, each as identified in an appendix to the proposed regulations.  

 Sensitive personal data:  CFIUS may review transactions related to U.S. businesses that maintain or collect sensitive personal data of U.S. citizens that may be exploited in a manner that threatens national security. “Sensitive personal data” is defined to include ten categories of data maintained or collected by U.S. businesses that (i) target or tailor products or services to sensitive populations, including U.S. military members and employees of federal agencies involved in national security, (ii) collect or maintain such data on at least one million individuals, or (iii) have a demonstrated business objective to maintain or collect such data on greater than one million individuals and such data is an integrated part of the U.S. business’s primary products or services.  The categories of data include types of financial, geolocation, and health data, among others.  Genetic information is also included in the definition regardless of whether it meets (i), (ii), or (iii).  

 Foreign person and excepted investor:  The regulations create an exception from “covered investments” for certain foreign persons defined as “excepted investors” based on their ties to certain countries identified as “excepted foreign states,” and their compliance with certain laws, orders, and regulations.  The regulations do not except these persons from control transactions previously subject to CFIUS jurisdiction; investments from all foreign persons remain subject to CFIUS’s jurisdiction over transactions that could result in foreign control of a U.S. business.

FIRRMA Provisions on Real Estate Transactions

In FIRRMA, Congress authorized CFIUS to review “the purchase or lease by, or a concession to, a foreign person of private or public real estate that”

“is, is located within, or will function as part of, an air or maritime port…” 

“is in close proximity to a United States military installation or another facility or property of the United States Government that is sensitive for reasons relating to national security;”

 “could reasonably provide the foreign person the ability to collect intelligence on activities being conducted at such an installation, facility, or property; or”

 “could otherwise expose national security activities at such an installation, facility, or property to the risk of foreign surveillance.”

 Pursuant to FIRRMA, this authority does not extend to “a single ‘housing unit.’”  This authority also does not apply to “real estate in ‘urbanized areas’ . . . except as otherwise prescribed by [CFIUS] in regulations in consultation with the Secretary of Defense.” (emphasis added)

 FIRRMA directs CFIUS to “prescribe regulations to ensure that the term “close proximity” refers only to a distance or distances within which the purchase, lease, or concession of real estate could pose a national security risk.”

 FIRRMA also requires that CFIUS prescribe regulations that further define the term “foreign person” for real estate transactions by specifying criteria to limit its applicability over certain categories of foreign persons.

The full text of the regulations is available, here. 

The Tide Turns: Rising Legal Services Employment in the United States

The legal services market in the United States contracted since the Great Recession.  However, there have been reports of a rebound.  CBRE, a commercial real estate firm, has released a report concerning legal services and real estate in the United States.  Part of the report concerns rethinking how square footage in law firms can be used more efficiently, including increasing collaboration space.  Another part of the report examines legal services employment—attorney employment--across the United States. 

The top five major legal services employment markets are 1) New York City; 2) Los Angeles; 3) Miami; 4) Chicago; and 5) Washington DC.  San Francisco is ninth.  The report states that there has not been much growth in most of the top ten major legal services employment markets except for Los Angeles (experiencing low double digit growth between 2015 and 2017) and San Francisco.  The report states that this is likely due to the growth in the media and tech industries.  In the highest growth markets category, Austin and Atlanta were the leaders in attorney growth.  Austin added more than 10%.  Austin is well-known for its tech industry.  According to the report, the cities of Austin, Atlanta and Kansas City added 10% or more growth in attorney positions since 2015.  The report also discusses the cities with largest decline in law degrees awarded. 

White House Releases Memorandum on Actions against China

President Trump has released his directions to the United States Trade Representative concerning China.  In the Presidential Memorandum on the Actions by the United States related to the 301 Investigation, the President states:

First, China uses foreign ownership restrictions, including joint venture requirements, equity limitations, and other investment restrictions, to require or pressure technology transfer from U.S. companies to Chinese entities.  China also uses administrative review and licensing procedures to require or pressure technology transfer, which, inter alia, undermines the value of U.S. investments and technology and weakens the global competitiveness of U.S. firms.

Second, China imposes substantial restrictions on, and intervenes in, U.S. firms’ investments and activities, including through restrictions on technology licensing terms.  These restrictions deprive U.S. technology owners of the ability to bargain and set market-based terms for technology transfer.  As a result, U.S. companies seeking to license technologies must do so on terms that unfairly favor Chinese recipients.

Third, China directs and facilitates the systematic investment in, and acquisition of, U.S. companies and assets by Chinese companies to obtain cutting-edge technologies and intellectual property and to generate large-scale technology transfer in industries deemed important by Chinese government industrial plans.

Fourth, China conducts and supports unauthorized intrusions into, and theft from, the computer networks of U.S. companies.  These actions provide the Chinese government with unauthorized access to intellectual property, trade secrets, or confidential business information, including technical data, negotiating positions, and sensitive and proprietary internal business communications, and they also support China’s strategic development goals, including its science and technology advancement, military modernization, and economic development.

It is hereby directed as follows:

Section 1.  Tariffs.  (a)  The Trade Representative should take all appropriate action under section 301 of the Act (19 U.S.C. 2411) to address the acts, policies, and practices of China that are unreasonable or discriminatory and that burden or restrict U.S. commerce.  The Trade Representative shall consider whether such action should include increased tariffs on goods from China.

(b)  To advance the purposes of subsection (a) of this section, the Trade Representative shall publish a proposed list of products and any intended tariff increases within 15 days of the date of this memorandum.  After a period of notice and comment in accordance with section 304(b) of the Act (19 U.S.C. 2414(b)), and after consultation with appropriate agencies and committees, the Trade Representative shall, as appropriate and consistent with law, publish a final list of products and tariff increases, if any, and implement any such tariffs.

Sec. 2.  WTO Dispute Settlement.  (a)  The Trade Representative shall, as appropriate and consistent with law, pursue dispute settlement in the World Trade Organization (WTO) to address China’s discriminatory licensing practices.  Where appropriate and consistent with law, the Trade Representative should pursue this action in cooperation with other WTO members to address China’s unfair trade practices.

(b)  Within 60 days of the date of this memorandum, the Trade Representative shall report to me his progress under subsection (a) of this section.

Sec. 3.  Investment Restrictions.  (a)  The Secretary of the Treasury (Secretary), in consultation with other senior executive branch officials the Secretary deems appropriate, shall propose executive branch action, as appropriate and consistent with law, and using any available statutory authority, to address concerns about investment in the United States directed or facilitated by China in industries or technologies deemed important to the United States.

(b)  Within 60 days of the date of this memorandum, the Secretary shall report to me his progress under subsection (a) of this section.

News agencies are reporting that tariffs will be assessed on around $50 billion of Chinese imports, here and here.  CNN reports that the U.S. companies that stand to lose in a U.S./China trade war include Intel, 3M, Boeing, Apple and others.  However, there is the question of how much those companies are losing because of intellectual property theft that may be supporting competitors based on stolen intellectual property in markets outside of China.