Govt to ink $10.4 bn fighter deal this year

Though initially six fighters were in the fray, the defence ministry on Wednesday declared its first selection. Only two European fighters – Eurofighter Typhoon, made by a four-nation European consortium and French Rafale, manufactured by Dassault Aviation – made the cut closing the doors on four others including two US fighters from Boeing and Lockheed Martin.

The defence ministry asked Eurofighter and Dassault to extend the terms of their commercial bids till December 31, 2011 so that price negotiation could be concluded in time. Once the price is finalised, approval from the Union Finance ministry and the Cabinet Committee on Security are needed before the commercial agreement can be inked, said an official.

The winning firm has to deliver the first fighter within 36 months of signing the commercial agreement.

The first 18 fighters will be delivered off-the-shelf while the remaining 108 planes will be manufactured at Hindustan Aeronautics Ltd in Bangalore under technology transfer. Once inducted, the MMRCA can replenish India’s ever depleting fighter squadron strength.

As against the sanctioned strength of 39.5 squadrons, the Indian Air Force currently has an all time low of 29 squadrons with a large number of ageing aircraft. Pakistan and China, on the other hand, are rapidly modernising their air forces.

Even though the initial request for proposal sent to the six aviation majors mentioned  purchasing of 126 fighters, there is an option for the government to buy additional planes of the same make, if the overall experience with the aircraft and company is satisfactory.

The losing companies, particularly the Americans, are deeply disappointed. While Boeing said it would request a debrief from the IAF on why they were rejected, Lockheed Martin said US government was working on a response to the letter from the defence ministry.

A ministry official clarified that all the four losers – the two US companies, Swedish Saab and Russian MiG Corporation – have received separate communication from the government side explaining the reasons for elimination.

The four aircraft did not receive the green signal as they were rejected on technical grounds. The IAF carried out trials of all six on 643 points and submitted the entire result to the defence ministry in August, 2010.

The evaluation process was designed to minimise political interventions with the IAF only assessing the technical characteristics of various aircraft.