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NEW DELHI (PTI): The Indian Defence Ministry has cleared a proposal worth over Rs 12,000 crore to procure 56 transport aircraft for the Air Force to replace its fleet of vintage Avro planes.

In a meeting of the Defence Acquisition Council (DAC) headed by Defence Minister A K Antony, the IAF proposal to issue a global tender for procuring these aircraft was cleared, Defence Ministry sources said here on Monday.

The first 16 aircraft will be procured off-the-shelf from foreign vendors who will have to partner with a local private or public sector firm, they said.

The next 16 aircraft will have to have 30 per cent indigenous component while the remaining 24 planes will have 60 per cent locally-procured and produced items.

Asked why the state-run Hindustan Aeronautics Limited (HAL) was not be involved in the project, they said the PSU was already burdened with projects such as the SU-30MKI production and upgrades of IAF aircraft fleet including the Mirage, MiG 29 and Jaguar aircraft.

HAL has a vast helicopter division and will also be involved in the forthcoming M-MRCA project for producing 126 combat aircraft, the sources said.

They said the 56-aircraft project would help in developing a domestic aerospace industry and capability to undertake such projects.

The IAF fleet of Avro aircraft was inducted from the 1960s and is used for transporting men and material. The aircraft can carry loads of upto 7-8 tonnes.

The DAC also cleared a proposal to create a new Defence Offsets Management Agency (DOMA) which will replace the existing Defence Offsets Facilitation Agency (DOFA).

Sources said the new agency will be under the Department of Defence Production (DoDP).

The meeting approved the inclusion of transfer of technology and critical technologies as defence offsets.

Under the Defence Procurement procedure (DPP), any foreign vendor bagging contract worth over Rs 300 crore has to reinvest at least 30 per cent of the money back in Indian defence, civil aerospace or homeland security sector.