In a major opportunity for the Indian private defence manufacturing sector,the IAF has floated a Rs 12,000-crore tender to buy new transport aircraft to replace the aging Avro fleet that mandates foreign vendors to participate with an Indian partner.
The tender,which seeks 16 transport planes to be bought off the shelf with the remaining 40 to be manufactured in India,is the first major contract that will see private sector participation as the defence ministry has deliberately kept public sector unit Hindustan Aeronautics Limited out of the picture.
The request for proposals was issued on Thursday to major global aviation players including Saab,Lockheed Martin,Airbus,Ilyushin,Embraer and Alenia Aeronautica. Incidentally,Alenia Aeronautica is part of the Finmeccanica group that has been named in a CBI FIR in the VVIP chopper case.
The programme has been keenly watched as it was touted as a pilot project to promote the private sector in India. However,there is a strong feeling in the industry that the project could face hurdles,primarily due to the fact that the Foreign Direct Investment cap of 26 per cent restricts foreign players from entering Indian partnerships.
Plus,the restrictions on export of defence equipment will be a deterrence for industry as a large investment in a manufacturing plant would be more viable if numbers go beyond the 40 to be built in India as per current plans.