Hindustan Aeronautics (HAL) on Thursday signed a memorandum of understanding (MoU) with GE Aerospace, a subsidiary of General Electric, for fighter jet engines. The news was first reported by Zee Business. The deal was signed amid a historic summit between Prime Minister Narendra Modi and US President Joe Biden. PM Narendra Modi is currently on his three-day visit to the US. The White House earlier said that the summit between PM Modi and US President Joe Biden will result in some major defence agreements, including an unprecedented deal on co-producing jet engines asserting that bilateral ties have entered the next generation.

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Modi and Biden will have a one-on-one meeting in the Oval Office of the White House on Thursday before holding high-level talks to bolster In "The US-India defence partnership has been growing stronger through the years, but we've now entered the next generation defence partnership," a senior administration official said hours ahead of the meeting between the two leaders.

The official said that the summit is expected to yield three major outcomes regarding defence relationships, adding that the first one is an "unprecedented" jet engine for coproduction. The US and India are welcoming a groundbreaking proposal by General Electric (GE) to jointly produce the F414 jet engines in India. GE and Hindustan Aeronautics Limited signed an MOU, and an export licence agreement has been submitted for congressional notification.

"This is a trailblazing initiative to manufacture F414 engines in India and will enable greater transfer of US jet engine technology than ever before," the senior administration official said. The second thing is trusted ship repair, the official said.

"The United States Navy has established master ship repair agreements that are going to result in cost-effective and time-saving sustainment for US military operations across multiple theatres by allowing US Navy ships to undertake to service and even major repair at an Indian shipyard," the official said.

"One is already in effect, and we have three more in the hopper. And then on the Defence Innovation Bridge, the India-US Defence Acceleration Ecosystem, also called Indus X," the official said.

Inaugurated on June 21, it is a network of university incubators, corporate think tanks, and private investment stakeholders.

"It is going to facilitate joint innovation on defence technologies and accelerate the integration of India's budding private sector defence industry with the US defence sector," said the official. "This is genuinely exciting as we see our companies and startups working together in ways that are better for India and better for the US," the official said.

Defence stocks in focus

The deal is likely to give a mega boost to the defence sector in India. At the time of writing this news, shares of HAL were trading 1.68 per cent lower at Rs 3,755 on the BSE. Mazagon Dock Shipbuilders, on the other hand, was trading flat. Cochin Shipyard was also trading flat but with a negative bias. The fall in defence stocks could be attributed to profit booking, as these stocks have seen a sharp rise in the recent past.

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With inputs from PTI