Article Posted on : - May 10, 2013

NEW DELHI (PTI): In a first step of its kind to strengthen the indigenous aerospace industry, the Defence Ministry has issued a tender expected to be worth over Rs 12,000 crore to replace IAF's Avro planes with 56 new aircraft which will be produced by the Indian private sector firms.

The tender has been issued to eight foreign vendors including American Lockheed Martin, Swedish Saab, Russian Rosoboronexport, Spanish Airbus Military, Italian Alenia and Brazilian Embraer and they will have to find an Indian partner to produce 40 aircraft within India, IAF officials said here.

Indian majors such as Tata, Mahindra Defence Systems, Reliance Industries and L & T are expected to partner the bidding foreign partners for the programme.

The defence acquisition council (DAC) headed by Defence Minister A K Antony had recently approved the IAF proposal for procuring these aircraft.

Of the 56 aircraft, the first 16 would be produced at the production facility of the foreign vendor while the remaining would be produced at the facilities of its Indian partner, sources said.

The first 16 aircraft to be produced in India will have to have 30 per cent indigenous component while the remaining 24 planes will have 60 per cent locally-procured and produced items, officials said.

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

In view of the fact that this would be first opportunity of its kind for Indian vendors, the Ministry has given five months instead of the usual three months for responding to the tender.

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

Asked why the state-run Hindustan Aeronautics Limited (HAL) has not been 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.

This project will help in widening the capabilities of the Indian aerospace manufacturing industry and creating a wider pool of players who can take up such activities.