Avro replacement transport aircraft: Rs 28,000 crore IAF order up for grabs

[IND151]

Antonov AN-148





The defense ministry (MoD) today issued a Request for Proposals (RfP) to eight foreign aerospace vendors, inviting tenders for co-producing 56 medium transport aircraft to replace the Indian Air Force’s (IAF’s) aging fleet of Hawker Siddeley 748M Avro aircraft. The deal could be worth about Rs 28,000 crore.

The proposal requires the vendor to deliver 16 aircraft in flyaway condition and build 40 in facilities to be established with an Indian partner that it can choose. This proposal has been driven by the IAF, which wants to wean itself off a crippling dependency on the public sector Hindustan Aeronautics Ltd (HAL). While HAL has licence-produced a series of fighter aircraft for the IAF, including the high-end Sukhoi-30MKI, it has been afflicted with serious time and cost overruns and charged with sub-quality manufacture.

Amongst the companies invited to bid are Boeing of the US, Ilyushin of Russia, Antonov of Ukraine, Franco-German consortium EADS and Alenia Aeromacchi of Italy. The MoD has given bidders five months to choose and tie-up partnerships with an Indian Production Agency (IPA) and submit their “techno-commercial proposals.”

Air Chief Marshal NAK Browne, the IAF chief, has strongly backed this project, hoping that it will create a badly needed aerospace manufacture eco-system within the private sector.

At a lecture organized by CII in New Delhi on Sept 01, 2011, Browne told the private sector, “Once you start licensed production in partnership with a foreign partner, you will develop a basic aerospace eco-system: the R&D, the jigs, tools and expertise that would work for the entire country.”

The MoD said today that this deal “ensures inflow of Production Technology to the IPA in phases wherein the value addition in the manufacture by the IPA will gradually increase from 30% to 60%. The IPA will also obtain the Transfer of Technology for Maintenance (MToT) which will enable the IPA to provide life time product support and maintenance up to Depot level (sic).”

The Indian partner will be selected by the foreign vendor based on a set of criteria that are specified in the RfP. These exclude small and medium companies and those that have not been consistently profitable. It is learnt that Reliance Industries’ aerospace venture; Larsen & Toubro; and a Tata Group company.

HAL has staunchly opposed this arrangement, lobbying with the MoD to build the 56 Avro-replacement transport aircraft at HAL Kanpur, where the Dornier 228 aircraft is currently built.

Contacted for a comment, HAL has not responded.

The CEO of a reputed private sector defense company says that the number of aircraft to be built in India --- just 40 --- is too low to repay the investment that will be required to set up an assembly line and the flight infrastructure that would be needed.

However the MoD is looking at requirements beyond the IAF’s. Today it said, “The replacement for the Avro aircraft will have extensive requirements even in the rapidly expanding civil aviation sector, especially for flights between growing regional cities. Such combined requirements of IAF and the civil sector will provide large production orders.”

The IAF fleet of some thirty 748M Avro twin-engine aircraft, which is now over forty years old, was built under licence by HAL. The replacement aircraft now being built will have a payload of 6-8 tonnes (the Avro carried 5 tonnes); a cruising speed of 800 kmph (the Avro flew at 450 kmph); and a range of 2,500-2,700 km (the Avro's was 1,700 km).

Broadsword: Avro replacement transport aircraft: Rs 28,000 crore IAF order up for grabs

 

[anant_s]

There are 2-3 threads going on simultaneously on this topic and each of them is quoting a different tender value. As per this report the deal is close to about USD 5 billion, thats humongous to say the least.
BTW hope they complete selection process quickly.

 

[sancho]

There are 2-3 threads going on simultaneously on this topic and each of them is quoting a different tender value. As per this report the deal is close to about USD 5 billion, thats humongous to say the least.
BTW hope they complete selection process quickly.

Exactly, guys please use available threads to post similar news!

The $5 billions are nuts, that's nearly $90 per aircraft and that's what we pay for the C130Js, the 13000 crores of the earlier reports seems to be much more reliable.

 

[IND151]

^^ probably the deal includes something else too

 

[anant_s]

New Delhi: 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.

Defence Ministry issues multi-crore tender for 56 new aircraft
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 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 upto 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.

Defence Ministry issues multi-crore tender for 56 new aircraft

 

[janon]

Exactly, guys please use available threads to post similar news!

The $5 billions are nuts, that's nearly $90 per aircraft and that's what we pay for the C130Js, the 13000 crores of the earlier reports seems to be much more reliable.

The cost of setting up a production line, as opposed to buying C-130s from Lockmart's prolific production line should be considered. However, the figure quoted here is ridiculous.

Ajai Shukla is smoking something potent.

 

[jha]

So now its 28K crore ... Sometimes it seems we should invest a hundred million dollars to coach our defence reporters.

 

[Abingdonboy]

The MoD-IAF seem to have their heads screwed on straight as far as this deal is concerned, the comment about this deal growing to more than purely the IAF's was very shrewd and pragmatic- it addressed any fears of the potential IPAs that the 40 units to be built in India was too few. For sure they can expect follow-on orders from the IAF, possible orders from civil airlines in India and possible orders from the likes of the IN, ICG, NSG and BSF.



This certainly is a critical deal for the Indian defence scene and could be the catalyst for much more pvt player participation in the aerospace market.




HAL are acting like spoilt brats- why do they think they deserve every single contract? There's enough pie for everyone to have a fair slice but they want it all to themselves, outrageous- I hope whatever IPA is selected well and truly shows HAL up.

 

[IND151]

The MoD-IAF seem to have their heads screwed on straight as far as this deal is concerned, the comment about this deal growing to more than purely the IAF's was very shrewd and pragmatic- it addressed any fears of the potential IPAs that the 40 units to be built in India was too few. For sure they can expect follow-on orders from the IAF, possible orders from civil airlines in India and possible orders from the likes of the IN, ICG, NSG and BSF.



This certainly is a critical deal for the Indian defence scene and could be the catalyst for much more pvt player participation in the aerospace market.




HAL are acting like spoilt brats- why do they think they deserve every single contract? There's enough pie for everyone to have a fair slice but they want it all to themselves, outrageous- I hope whatever IPA is selected well and truly shows HAL up.

There will be follow on orders, the final number of aircrafts may reach 70

 

[sancho]

The cost of setting up a production line, as opposed to buying C-130s from Lockmart's prolific production line should be considered. However, the figure quoted here is ridiculous.

Ajai Shukla is smoking something potent.

The C130J is simply a different class and can be considered here, especially since we already will have the MTA. If such a class would be considered as Avro replacements, it definitely would be more MTAs, but it's more likely that IAF wants a more cost-effective solution at the lower end.