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India floats Rs 42,000-cr defence tender
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August 28, 2007 18:09 IST

India has floated its biggest-ever global defence tender for purchase of 126 multi-role combat aircraft-- a deal which will run up to a staggering Rs 42,000 crore.

An official announcement in New Delhi on Tuesday said the 'Request For Proposals' for fighters had been issued to six main bidders, ending an eight-year suspense over the acquisition. The strength of Indian Air Force fighters during this year had plunged to an all-time low of 32 squadrons (576 aircraft)

Under the proposal, 18 fighters would be bought off the shelf and remaining 108 manufactured under technology transfer in India. The RFP also stipulates an option of India purchasing another 64 fighters under the same terms and conditions.

The defence ministry expects the first batch of 18, which will be supplied in a flyaway condition to be inducted in IAF by 2012.

The chosen manufacturer will have to spend 50 per cent as direct offsets on the aircraft or defence manufacturing industry in India, it said.

"As the tender is huge, 50 per cent direct offsets has been mandated, preferably in the aircraft project itself," top ministry sources said.

Former defence secretary Shekar Dutt said the offsets could flow to other defence projects, if the country needed.

The six bidders as listed by the ministry are American Aviation giants Lockheed Martin in contention with their F-16 Fighting Falcons, Boeing with twin-engined F-18/A Super Hornets, French Dassault with Rafale fighters, Swedish SAAB's Gripen JAS-3, Euro fighter typhoon and Russian Aircraft Corporation's just unveiled Mig-35.

Asserting that the selection process would be transparent and fair, the ministry said the new fighters were expected to have a lifeline of over 40 years or an actual flying time of 6,000 hours.

For the first time under the new fighter RFP, the government incorporated the life-cycle cost calculation. The costs of the aircraft would include direct acquisition, including that of weapons and missiles, warranty for first two years, licence royalty for manufacture in India, cost of technology transfer and costs of initial training.

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