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From Stratfor's newsletter:
'Official leaks from the Pentagon said that India would begin purchasing up to $5 billion worth of conventional weapons, once Congress approves the deal. This requires an act of Congress because current law on non-proliferation bars the sale of a wide array of military technology to countries that have acquired nuclear weapons -- specifically focusing on any technology that might be useful to a nuclear weapons program. Since the technologies that are potentially useful are amazingly diverse, large swathes of technology are excluded from sale. Should Congress approve the bill, it would place India in a position similar to that of Israel (save that Israel doesn't acknowledge publicly that it has nuclear weapons).'
'India will be allowed to purchase Aegis technology, which is designed to protect naval vessels -- and battle groups -- from anti-ship missiles. So far, only Japan has acquired the technology, partly because of its cost. In addition, New Delhi will be able to purchase anti-submarine patrol aircraft. The United States, which until a few years ago regarded the Indian naval build-up -- based on Soviet technology -- as a threat to U.S. control of sea lanes in the Indian Ocean, has now completely reversed its posture. It is selling New Delhi naval technology that will allow the Indians to fulfill one of their key strategic objectives, which is to be able to control regional sea lanes. The United States would not be providing this technology without having achieved a far-reaching strategic agreement with New Delhi.'
All this, of course, has nothing to do with Chinese naval ambitions.
Update 17.31: Read this too.
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