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India Moves A Step Closer On Fighter Decision

by: Matthew Potter
November 7, 2011

Category: Boeing, Business Line, Companies, Contract Awards, Countries, D'Assault, development program, Events, India, Lockheed Martin, MiG, Military Aviation, production program, Proposal, SAAB, Services | RSS 2.0

As reported last month India’s Government announced on Friday that they have begun the final process for selecting the winner in the Medium Multi-Role Combat Aircraft (MMRCA) contract. This is to buy a modern, Western fighter aircraft to replace some aging Russian ones and supplement a modern fighter being jointly developed by India and Russia. After a lengthy contest the remaining two contenders are Eurofighter and France’s Dassault Rafael.

On the 4th the committee responsible for negotiating the price of the 126 aircraft and its life-cycle support received the final bids from the two companies. The estimated cost for the contract will be in the $10 billion range. The final review and negotiations leading to the choice of a winner should be completed by the end of 2011.

The contest began almost five years ago and proposals were received from six different companies. Two American; Lockheed Martin (LMT) and Boeing (BA); Sweden’s SAAB and Russia’s United Aircraft Corp. as well as the two Western European aircraft. Interestingly after the evaluation of the proposals and analysis of the aircraft’s capabilities all were eliminated but the Typhoon and Rafael. This was a blow to the U.S. who were hoping to be able to sell a modern fighter to India building upon two earlier contract negotiations for Boeing’s P-8 maritime patrol aircraft and Lockheed’s C-130J transport.

The U.S. after their aircraft had been eliminated had raised the idea of proposing a variant of the F-35 Joint Strike Fighter (JSF) for the contract but India did not entertain that. The JSF is currently in Low Rate Production and is the product of the U.S. and several other countries. Unlike the other six earlier bids it is a Fifth Generation aircraft.

This contract along with Brazil’s stalled contest are the only two major foriegn fighter sales currently available although Japan is planning to begin the process to buy a new aircraft. The major aerospace contractors are looking for these deals to make up for reduced spending by the U.S. and European governments due to budgetary pressures and the cut backs in Iraq and Afghanistan.

The winning of the Indian contract would be the first foreign sale of the Rafael which is only used by the French Air Force and Navy. The Eurofighter has been sold to Saudi Arabia. Both aircraft were used in the recent air campaign against Libya. Eurofighter would also like the sale as the European partners such as the U.K. and Germany are considering buying less Typhoons then they originally committed to due to funding shortfalls.

The sale to India too would mark a breakthrough as they traditionally have bought Russian or domestic aircraft or with programs like the Hawk trainer manufactured them in India. The contract has stiff offset requirements and the winner will have to invest around $5 billion in the Indian economy. India’s offset and technology transfer rules have in the past made it hard especially for American companies to bid on their military contracts. This deal along with others are the result of modifications to those rules made in recent years.

This contract will see the first 18 aircraft built overseas and then the remainder manufactured in India.

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  1. Rafale Wins One As India Accepts Dassault’s Bid for MMRCA | Defense Procurement News on February 1st, 2012 3:10 am

    […] South East Asian country’s Medium Multi-Role Combat Aircraft (MMRCA) contract. In November there had been a decision to start the process to select the final winner of the contract with the choice between the Rafale and the Eurofighter […]

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