The over $10-billion (Rs 50,000 crore) deal to supply 126 fighter jets to the Indian Air Force has been won by the French firm Dassault Aviation SA.
The deal is estimated to be the largest Indian defence deal. The number of Rafale aircraft supplied finally could increase as the contract allows for this.
Sources indicated that Dassault emerged the lowest bidder for supplying the 126 fighter jets, which was commonly known as the Medium Multi-role Combat Aircraft (MMRCA).
The French company beat five other contenders including Boeing, Lockheed Martin, Cassadian (formerly EADS), Eurofighter, Russian MiG 35 and SAAB.
While the initial cost of the project is estimated at $10 billion, it could go up depending on what emerges after detailed negotiations that are expected to begin shortly.
Official sources indicated that Dassault was informed of the Government decision on Tuesday morning. Although Dassault has been informed of the decision, industry sources indicate that it could take six months or more before the contract is finally inked.
Industry sources indicated that the Request for Proposal for the project has stipulated that the company which wins the contract will have to supply 18 of the 126 aircraft to the IAF in 36 months from its facilities and the remaining would be produced at HAL facilities.
Price negotiations
“The company will now begin price negotiations which will have to be approved by the Cabinet Committee on Security before the proposal can be inked,” sources said.
They point to the contract for the trainer aircraft project for the Air Force for which the successful bidder was announced close to eight months ago but the contract is yet to be inked. The issue of transfer of technology will also be discussed with the Indian authorities.
In many ways, the decision ends the gruelling efforts being made by the IAF in the past two years during which it has been evaluating the products of the six contenders with the aircraft offered being put through rigorous flight tests in Leh (high mountainous terrain), Jaisalmer (hot desert terrain) and Bangalore and also across the coastal belt.
Other proposals
Tuesday's decision comes on the heels of the Government clearing at least three-four proposals for the IAF during 2011, including the purchase of the C-17 Globe Master, C-130J Hercules and the $3-billion upgrade of 51 Mirage 2000 aircraft.
ashphadnis@thehindu.co.in