EXTRANCHECK: POST-SHIPMENT VERIFICATION: HINDUSTAN

UNCLAS NEW DELHI 005303

SIPDIS

SIPDIS

USDOC FOR 532/OEA/M. NICKSON-D/JAY HATFIELD
USDOC FOR 3131/USFCS/OIO/ANESA/KREISSL
USDOC FOR 4530/MAC/ANESA/OSA
ICE HQ FOR STRATEGIC INVESTIGATIONS
STATE FOR EB/ESP

E.O. 12958: N/A
TAGS: ETTC ETRD BEXP IN
SUBJECT: EXTRANCHECK: POST-SHIPMENT VERIFICATION: HINDUSTAN
AERONAUTICS LTD., AIRCRAFT DIVISION, BANGALORE, LICENSE NUMBER
D364780

REF: USDOC 09453


1. Unauthorized disclosure of the information provided below is
prohibited by Section 12(c) of the Export Administration Act.


2. On November 26, 2007, Export Control Officer (ECO) Paul Cushman
and BIS FSN Prem Narayan conducted a Post-shipment Verification
(PSV) at Hindustan Aeronautics Ltd. (HAL),Aircraft Division,
Bangalore.


3. BIS requested a PSV at HAL, an entity under the Ministry of
Defence (MOD),GOI. HAL was listed as the recipient of software for
five or more axis contouring capability on hard drive 3-424-2284A03
controlled under ECCN 2D002. The license applicant was SUNAG
CORPORATION (SUNAG),Montville, New Jersey.


4. ECO and FSN Narayan met with Jaya Krishnan (Krishnan),Chief
Manager, Purchasing, Ajay Kumar (Kumar),Purchasing Officer and
Gopal Srivastava (Srivastava),Senior Manager, Plant Maintenance,
HAL. Randhir Jaiswal (Jaiswal),Deputy Secretary, Ministry of
External Affairs (MEA),facilitated the meeting. Jaiswal was also
present at the meeting.


5. HAL officials did not recall a previous visit by BIS officials to
the HAL Aircraft Division. They were aware of certain BIS
regulations. Krishnan provided a copy of the HAL Purchase Order,
HAL End-User Certificate, AIR Waybill and HAL Receiving Report After
Inspection. SUNAG provided BIS export license conditions to HAL in
the form of a copy of the license which HAL officials did not share
with the BIS Team.


6. He stated that they purchased a Cincinnati 30V-5 Axis CNC
profiler in 1991. Over time, the hard drive for the CNC profiler
became inoperable. The hard drive on check replaced the inoperable
hard drive. Srivastava confirmed the end-use stating that the CNC
profiler is used to machine light alloys in the manufacture of parts
and components for BOEING and AIRBUS.


7. After the meeting, the BIS Team was given a tour of the workshop.
ECO was able to confirm the hard drive model number
(3-424-2284A03),PC card number (3-533-0768G) and manufacturing date
(01/22/2006) but could not see the hard drive, which was installed
deep within the apparatus. In addition, the HAL Team presented the
old hard drive for inspection. However, the model and serial
numbers inscribed on it were smudged and unreadable.


8. HAL, established in 1940, is the largest public sector
undertaking within the Department of Defence Production, MOD. HAL,
currently has sixteen production units and nine research and design
centers in seven locations throughout India. Of the 3,300 aircraft
HAL has manufactured, approximately 1,100 were based on indigenous
design. To date, it has manufactured approximately 3,500 aircraft
engines, and performed overhauls of more than 8,100 aircraft and
27,000 engines. In addition, HAL has played a significant role in
India's space program by participating in the manufacture of
Satellite Launch Vehicles such as PSLV (Polar Satellite Launch
Vehicle),GSLV (Geo Stationary launch Vehicle),IRS (Indian Remote
Satellite) & INSAT (Indian National Satellite). HAL's major clients
include the Indian AIR Force, Indian Army, Indian Navy, Indian Coast
Guard, the Department of Space, and the Border Security Forces. It
also supplies transport aircraft and helicopters to various airlines
and Indian state governments. HAL employQapproximately 32,000
personnel.


9. Recommendation: At the time of this visit, the Aircraft Division
of Hindustan Aeronautics Ltd. appeared to be a suitable recipient of
the licensed commodities. To the degree that it was practical, the
items on check were physically verified and were apparently being
used in accordance with the license conditions.
WHITE