Article Posted on : - Jan 17, 2014

A file photo.

NEW DELHI (PTI): Government has asked the European Airbus Defence company to extend the validity of its tender bid for supplying six mid-air refuelling aircraft, expected to be worth over Rs 6,000 crore, up to July 31 in the next fiscal.

The development comes at a time when the Defence Ministry has almost exhausted its modernisation funds for this fiscal and is understood to have postponed till 2014-15 the finalisation of many key deals such as the procurement of attack and heavy-lift helicopters.

Defence ministry asked us to extend the validity of our bid up to July 31, 2014, for supplying six Airbus A330 MRTT aircraft and we have agreed to that, Airbus Defence officials said here.

IAF last year selected Airbus to fulfil its requirement for six mid-air refuelling aircraft and is in negotiations with the European firm for finalising the contract, which is expected to be worth over Rs 6,000 crore.

The firm was chosen by IAF after it emerged as the lowest bidder in terms of life-cycle costs against its Russian rival, the Ilyushin-78 tanker aircraft.

IAF has plans of deploying the aircraft at Panagarh in West Bengal, which is also the site for the setting up of the headquarters of Army's new Mountain Strike Corps, coming up along the China border.

Asked to comment on the Government of India's cancellation of the deal with AgustaWestland for 12 VVIP choppers, Airbus Defence official Peter Gutsmiedl said his group's top priority was compliance with ethics and India's sensitivity towards such issues.