Lengthy negotiations between the Defence Ministry's finance wing, the Indian Air Force (IAF) and government-owned Hindustan Aeronautics Limited (HAL) has resulted in major relief. The deliberation has now resulted in the IAF sealing the deal for a price Rs 10,000 crore lesser than the earlier quoted price by HAL.
In November 2016, Defence Ministry's highest decision-making body, the Defence Acquisition Council (DAC) had given a green signal for the purchase of 83 Tejas Mark-1A by the IAF at a cost of Rs 50,025 crore. News agency ANI quoting the sources in the defence ministry reported, "The draft contract of the deal has been readied by the HAL and the cost of the deal has now come down to around Rs 40,000 crore. This is Rs 10,000 crore less than the Acceptance of Necessity given by the Defence Ministry in 2016."
Two parties negotiate over price of LCA-Mk1A aircraft
Interestingly, it's been more than a year since the two parties were negotiating over the price of LCA-Mk1A aircraft. The initial clearance for as many 83 of these aircraft was given by The Defence Acquisition Council (DAC) in November 2016. After the clearance, the IAF took another year to issue Request For Proposal (RFP) in December 2017. However, further negotiations were halted due to exorbitant price quoted by the HAL, which the IAF had argued was more than the price of a Su-30MKI. Former defence minister, Nirmala Sitharaman has formed a committee to negotiate the price. Now with all the hurdle are in the stage of being cleared, the production of the Tejas LCA is expected to pick up the pace.
The IAF had requested some improvement in the Tejas and after the upgrades, the aircraft would be loaded with improved serviceability, faster weapon-loading time, enhanced survivability, a better electronic warfare suite and Active Electronically Scanned Array (AESA) radar. The first squadron of the Tejas aircraft was inducted into the IAF at Bengaluru as No. 45 Squadron 'Flying Daggers' but has now been transferred to Sulur, Tamil Nadu. The squadron has already participated in multiple exercises and demonstrations to showcase its capabilities on a global scale.
In recent years, the Indian Airforce (IAF) has been witnessing a depletion in the number of squadrons. The IAF requires at least 42 air squadrons to face a two-front war but the depleting strength of these squadrons is giving a major headache to the IAF. Currently, the IAF is operating with only 33 squadrons. With Soviet-era MiG-21 fighter aircrafts getting too old to be continued in service and slow manufacturing of indigenous Tejas aircraft, the IAF is in a desperate situation to maintain its fleet. Further, India planned to buy 126 Medium Multi-Role Combat Aircraft (MMRCA) fighters from France but finally, only 36 fighters were ordered.
