India offers to buy 200 foreign combat
jets - if they're Made-in-India
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[October 29, 2016]
By Sanjeev Miglani
NEW DELHI (Reuters) - India is offering to
buy hundreds of fighter planes from foreign manufacturers - as long as
the jets are made in India and with a local partner, air force officials
say.
A deal for 200 single-engine planes produced in India - which the air
force says could rise to 300 as it fully phases out aging Soviet-era
aircraft - could be worth anything from $13-$15 billion, experts say,
potentially one of the country's biggest military aircraft deals.
After a deal to buy high-end Rafale planes from France's Dassault was
scaled back to just 36 jets last month, the Indian Air Force is
desperately trying to speed up other acquisitions and arrest a fall in
operational strength, now a third less than required to face both China
and Pakistan.
But Prime Minister Narendra Modi's administration wants any further
military planes to be built in India with an Indian partner to kickstart
a domestic aircraft industry, and end an expensive addiction to imports.
Lockheed Martin said it is interested in setting up a production line
for its F-16 plane in India for not just the Indian military, but also
for export.
And Sweden's Saab has offered a rival production line for its Gripen
aircraft, setting up an early contest for one of the biggest military
plane deals in play.
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"The immediate shortfall is 200. That would be the minimum we would be
looking at," said an air officer briefed on the Make-in-India plans
under which a foreign manufacturer will partner local firms to build the
aircraft with technology transfer.
India's defense ministry has written to several companies asking if they
would be willing to set up an assembly line for single-engine fighter
planes in India and the amount of technology transfer that would happen,
another government source said.
"We are testing the waters, testing the foreign firms' willingness to
move production here and to find out their expectations," the person
said.
OPERATIONAL GAPS
India's air force originally planned for 126 Rafale twin-engine fighters
from Dassault, but the two sides could not agree on the terms of local
production with a state-run Indian firm and settled for 36 planes in a
fly-away condition.
Adding to the military's problems is India's three-decade effort to
build a single-engine fighter of its own which was meant to be the
backbone of the air force. Only two of those Light Combat Aircraft,
called Tejas, have been delivered to the air force which has ordered 140
of them.
The Indian Air Force is down to 32 operational squadrons compared with
the 45 it has said are necessary, and in March the vice chief Air
Marshal B.S. Dhanoa told parliament's defense committee that it didn't
have the operational strength to fight a two front war against China and
Pakistan.
JET MAKERS RESPOND
Saab said it was ready to not only produce its frontline Gripen fighter
in India, but help build a local aviation industry base.
"We are very experienced in transfer of technology – our way of working
involves extensive cooperation with our partners to establish a complete
ecosystem, not just an assembly line," said Jan Widerström, Chairman and
Managing Director, Saab India Technologies.
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![](../images/102916pics/news_s33.jpg)
An Indian Air Force (IAF) light combat aircraft "Tejas" performs
during the Indian Air Force Day celebrations at the Hindon Air Force
Station on the outskirts of New Delhi, India, October 8, 2016.
REUTERS/Adnan Abidi/File Photo
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He confirmed Saab had received the letter from the Indian government
seeking a fourth generation fighter. A source close to the company
said that while there was no minimum order set in stone for it to
lay down a production line, they would expect to build at least 100
planes at the facility.
Lockheed Martin said it had responded to the defense ministry's
letter with an offer to transfer the entire production of its F-16
fighter to India.
"Exclusive F-16 production in India would make India home to the
world's only F-16 production facility, a leading exporter of
advanced fighter aircraft, and offer Indian industry the opportunity
to become an integral part of the world's largest fighter aircraft
supply chain," Abhay Paranjape, National Executive for Lockheed
Martin Aeronautics Business Development in India said in an email.
U.S. TOP SUPPLIER
Lockheed's offer comes on the back of expanding U.S.-India military
ties in which Washington has emerged as India's top arms supplier in
recent years, ousting old ally Russia.
Earlier this year Boeing also offered India its twin-engine F/A-18
Hornets, but the level of technology transfer was not clear.
India has never previously attempted to build a modern aircraft
production line, whether military or civilian. State-run Hindustan
Aeronautics (HAL) has assembled Russian combat jets including the
Su-30, but these are under licensed production.
"We have never had control over technology. This represents the most
serious attempt to build a domestic base. A full or a near-full tech
transfer lays the ground for further development," said retired
Indian air marshal M. Matheswaran, a former adviser at HAL.
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He said the Indian government would be looking at producing at least
200 fighters, and then probably some more, to make up for the
decades of delay in modernizing the air force.
(Reporting by Sanjeev Miglani, with additional reporting by Tommy
Wilkes in NEW DELHI; Editing by Ian Geoghegan)
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