By David Brunnstrom and Andrea Shalal
WASHINGTON (Reuters) - The United States aims to secure agreements with India to start pilot projects for joint production of drones as well as equipment for transport planes in talks next week ahead of a visit by President Barack Obama, a U.S. industry source said on Wednesday.
Frank Kendall, U.S. undersecretary of defense for acquisition, technology and logistics, will be making his fourth visit to India to promote collaboration on defense technologies and co-production of weapons systems in an effort to finalize the projects.
Kendall's spokeswoman Maureen Schumann said he will meet with Defense Secretary Radha Krishna Mathur, Secretary for Defense Production G. Mohan Kumar and Scientific Advisor to the Minister of Defense Avinash Chander.
"His primary objective is to continue momentum on the Defense Trade and Technology Initiative (DTTI), which promotes collaboration on defense technology and enables co-production and co-development of critical defense systems," Schumann said.
An industry source familiar with U.S.-India discussions on the defense initiative said Kendall aimed to finalize two pilot projects, one involving unmanned aerial vehicles (UAVs) and the other involving systems for the C-130 military transport aircraft built by Lockheed Martin Corp.
The source said the drone project involved the RQ-11 "Raven" built by AeroVironment Inc, a small U.S. firm. Raven is the world's most widely used unmanned aircraft, a lightweight plane that can be used manually, or for autonomous operations.
The U.S. government strictly controls foreign sales of larger UAVs, but has approved sales of unarmed systems like the Raven, which are used purely for surveillance to a range of countries, including Uzbekistan, according to a U.S. source.
The transport plane project involves manufacturing of roll-on, roll-off modules that allow C-130s to be used for surveillance, and as VIP transports or hospitals, according to the industry source, who did not want to be named due to the sensitivity of the discussions.
U.S. and Indian officials have declined to comment publicly on the systems under discussion, but the industry source said the aim was to announce the pilot projects during Obama's planned visit to India to attend the country's Jan. 26 Republic Day holiday, which is marked by a big military parade.
Lockheed declined comment on any specific co-production agreement, but a spokesman said teams from five Indian universities were participating in a design challenge to develop C-130 modules for use in disaster relief around the world.
India has received five C-130Js built by Lockheed, and six more planes are on order through 2017, parts of which will be built in India.
No comment was immediately available from AeroVironment.
The United States is keen to develop its political and strategic ties with India, with which it shares concerns about China's increasingly assertive territorial claims in the Asia-Pacific region.
Since the DTTI was launched in 2012, the United States has proposed 17 projects with potential for collaboration. But the initiative has been hampered by concerns from India that the projects do not sufficiently involve the transfer of technology.
On the U.S. side, meanwhile, there have been concerns about India's demand for the right to manufacture components rather than whole systems, which could put them in competition with U.S. manufacturers.
Ellen Lord, president and chief executive officer of Textron Systems, an aerospace unit of defence firm Textron Inc, which makes Bell helicopters and UAVs, told Reuters she was encouraged by reforms being undertaken by the Indian government.
"I'm energized by what I see as very positive changes," said Lord, who returned on Tuesday from a visit to India.
(Reporting by David Brunnstrom; editing by Andrew Hay)