India to ink 2 landmark military aircraft deals in next few months

By Times of India

India is gearing up for two major long-pending military aircraft deals, together worth over Rs 50,000 crore, in the new year. The contracts for 83 indigenous Tejas fighters and 56 medium-transport aircraft through a Tata-Airbus joint venture are set to be inked within the next few months.

The over Rs 37,000 crore order for 83 Tejas Mark-1A jets from defence PSU Hindustan Aeronautics Ltd will be the biggest-ever deal in the indigenous military aviation sector. These 83 fighters, the deliveries of which will begin three years after the contract is inked, will have 43 “improvements” over the 40 Tejas Mark-1 already ordered by the IAF.

The Tata-Airbus project to build 56 twin-turboprop C-295 aircraft, which will replace the old Avro-748 aircraft of IAF, in turn, will be the first time an Indian private sector company will enter the defence aerospace arena.

While Airbus will supply the first 16 aircraft in two years after the contract is inked, the rest 40 will thereafter be built in India within eight years, in the project which was initially valued at Rs 11,929 crore.

Both the projects have been sent to the Cabinet Committee on Security (CCS) for the final approval. “The Tejas contract will be the first to be approved by the CCS. It is likely to be inked in early-February. The C-295 project, with the participation of Tata as the Indian production agency will follow subsequently,” said an official on Tuesday.

The overall cost of acquiring the 83 single-engine Tejas fighters and their support package has been cut down from the earlier around Rs 56,500 crore being demanded by HAL after protracted negotiations, as was reported by TOI last year.

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