By Manu Pubby, ET Bureau | 11 Apr, 2015, 01.00AM IST

NEW DELHI: After a series of twists and turns almost befitting its size, the multi-billion dollar deal for new fighter jets for the Indian Air Force has hit the last mile with a firm political push by the NDA government to iron out differences and wrap up negotiations with an out-of-the-box solution to end a two-year-old deadlock. In the initial phase, 36 Rafale fighters will be bought off the shelf and negotiations will continue for manufacturing more in India at a later stage.

The reworked deal — buying 36 fighters outright with the option for more could be worth up to $7.5 billion — has the potential of pumping in over $2.3 billion into the Indian defence manufacturing sector, a major chunk of which will go to the private industry.

According to the understanding reached, the two sides agreed to conclude an Inter-Governmental Agreement for supply of the aircraft on terms that would be 'better than as conveyed by Dassault Aviation as part of a separate process underway'. This means that the 36 fighters are cheaper than offers made in the past by Dassault.

Buying fighters off the shelf means the delivery would be faster and would meet a time frame set by IAF that urgently needs the aircraft to fill operational gaps. The aircraft would be delivered on the same configuration as had been tested and approved by IAF during the 2007 tendering process. Sources said separate negotiations will continue at a ministerial level on manufacturing more fighters in India. The total requirement is for 126 fighters.

More:

http://economictimes.indiatimes.com/news/defence/india-to-buy-36-rafale-jets-in-fly-away-conditions-from-france-deal-to-be-worked-out/articleshow/46881597.cms

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