Concerns Rise As Indian Fighter Negotiations Drag On

By Jay Menon
Source: Aerospace Daily & Defense Report

The defense ministry official says the induction of Rafales from 2018 will help arrest the depletion of the IAF’s squadron strength, which will go up to 42 squadrons with the planned new inductions, including the Indo-Russian Fifth Generation Fighter Aircraft (FGFA) by 2025.

However, the long-term plan for co-developing the FGFA with Russia also has been delayed. It is expected to take at least another year to conclude the $11 billion full-design R&D contract for the futuristic fighter, Browne says.

For MMRCA, the defense ministry has been in contract negotiations with Dassault for about 20 months. The technical and commercial evaluation process began in August 2007, with the French Rafale fighter finally emerging as the winner in January 2012.

Under a proposed agreement, the Indian air force will get 18 Rafale aircraft from Dassault Aviation in fly-away condition; the rest would be manufactured by the state-run Hindustan Aeronautics Ltd. (HAL) under license from the French company.

According to sources close to the negotiations, the primary bone of contention is Dassault’s demand for two separate contracts: One for the 18 aircraft to be built in France and the other for the 108 aircraft, which are be integrated in India by HAL. The defense ministry has rejected this demand, and has conveyed that Dassault will be solely responsible for the entire lot of 126 aircraft, as per the original proposal.

Contract negotiations also have been delayed over issues arising out of the offset provisions, under which Dassault Aviation must reinvest 50% of the deal’s value in the Indian defense sector, through either direct purchases or providing technological know-how.

The French fighters are expected to replace India’s aging MiG-21 fleet from the Soviet era. The Rafale and Eurofighter Typhoon became the finalists in April 2011 after India ruled out the Boeing F/A-18, Lockheed Martin F-16, Saab Gripen and United Aircraft Corporation MiG-35.

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