Aero India

Will the IAF find a future mainstay fighter?

Aero India is a mega biennial aero show. The 11th edition is from 14th to 18th February 2017. The event is a marketplace for the defence industry. It is the largest in Asia and second largest in the world.  The show features over 70 aircrafts — light combat aircrafts, helicopters, fighters and unmanned aerial vehicles to name a few. The indigenously equipped small surveillance plane, AEW&CS, will be inducted into the Air Force during the first day of Aero India-2017. The AEW&CS has been developed at a cost of US $358 Million (₹2,400 Crore).

Who are the External Suppliers?

• Exhibitors from USA., France, the UK, Russia, Israel, Germany, Belgium, Switzerland, Ukraine, Singapore, Sweden, Spain, South Africa, Italy, the UAE, South Korea, Hong Kong, the Czech Republic, Canada, Australia, Poland and Greece will participate.
• IAF global tender for 126, 4th Generation fighter aircraft had been awarded to Dassault of France. However, because of differences over the local production, India scaled back and agreed to purchase only 36 aircraft, without transfer of technology.
• Other companies appear more ready for the ‘Make in India’ initiative. US majors, Lockheed Martin & Boeing and Sweden’s Saab are leading contenders; letters have also been sent to Germany, Italy and Russia.

What are They Offering?

Airbus’ industrial engagement with India yields over $500 million (about Rs. 3,400 Crore) and generates local employment for more than 6,000 people. Airbus has partnered with Tata Advanced Systems Ltd and Mahindra Defence as part of the ‘Make in India’ initiative.  Saab is likely to offer the Gripen E fighter, which have also been supplied with Transfer of Technology (ToT), to Brazil.

Lockheed Martin has offered to make India, the sole global manufacturing hub for its exclusive F-16 Block 70 aircraft. There are 3,200 F-16 aircraft being flown around the world (including Pakistan) and they shall be supplied from India, if offered. Boeing has offered to provide the F/A-18 Super Hornet, with full ToT, to an Indian partner.

Assessment

The ‘Make in India’ clause is the major Indian policy change but it will also be cause for mark-up on market prices. Defense deals particularly of such magnitude, will get evaluated through the defense Procurement Procedure (DPP), which was refined, yet again, in 2016. Hither-to-fore, India’s major defense deals invariably get mired in bureaucratic delays, PSU interference, time delays and allegations of corruption. India’s procurement of 4^th Generation fighters, is as much a challenge for our defense preparedness, as it is for the new DPP.