Lockheed May Tempt India With Stealth F-35 - Bloomberg
Lockheed Martin Corp. (LMT) may offer its latest F-35 stealth fighter jet to India in a bid to rejoin the Asian countrys $11 billion combat-jet competition after the companys older F-16 model was eliminated.
Lockheeds chances of offering the F-35 for the 126-plane order were boosted last week when the U.S. Senate Armed Services Committee asked the Defense Department to study the desirability and feasibility of a joint strike fighter sale to India, said Patrick Dewar, senior vice president for corporate strategy and business development, in an interview at the Paris Air Show.
The Senate committee report accompanying the Pentagons 2012 budget opens the window to fifth-generation fighter technology release to India, however the Indian services want to deal with it, Dewar said.
The Senate committee request for a Pentagon study on selling F-35s to India was part of a broader amendment on U.S.- India military ties offered by Senators John Cornyn, Republican of Texas, where the fighter is produced, and Joseph Lieberman, independent of Connecticut, home to United Technologies Corp. (UTX), which makes the planes engines.
Cornyns spokeswoman, Jessica Sandlin, said the amendment was overwhelmingly adopted by the Senate defense panel. Cornyn is the co-founder and co-chairman of the Senate India Caucus. The provision is a so-called Item of Special Interest that takes effect immediately after the bill report is issued. It doesnt need House approval and takes effect regardless of what happens to the bill itself, she said.
MiG-Replacement
Lockheeds F-16, based on a 30-year-old design, was eliminated in April from the six-way Indian contest to replace its aging fleet of 1970s-era MiG-21s, along with Boeing Co. (BA)s F/A-18 Super Hornet. On the shortlist are Dassault Aviation SA (AM)s Rafale and the Eurofighter made by BAE Systems Plc, Finmeccanica SpA (FNC) and European Aeronautic, Defense & Space Co.
The competition is one of the largest in recent years and also attracted bids from Russias OAO United Aircraft Corp. and Swedens Saab AB (SAABB), which offered the Gripen. President Barack Obama had lobbied on behalf of Bethesda, Maryland-based Lockheed and Chicago-based Boeing.
I certainly believe its possible, Dewar said when asked if the potential F-35 offer could lead to the Indian Air Force reopening the contest. India might think differently about the competition should the stealth jet become available.
Succumbing to U.S. Pressure
Admitting the joint strike fighter to the bidding at this stage would be contrary to Indias weapons-acquisition procedure, said Mrinal Suman, an arms-procurement adviser at the Confederation of Indian Industry in New Delhi. Its too late in the day, he said. It would be seen by many as succumbing to U.S. pressure.
Indian defense ministry spokesman Sitanshu Kar couldnt be reached for comment.
The Senate defense panels request to study the F-35 sale to India was part of a broader provision that would require the Obama administration to prepare a detailed assessment of the current state of U.S.-India security cooperation. The bill seeks a five-year plan for more joint military exercises, defense trade and support for Indias military modernization, homeland security and coastal defense, and maintenance of secure sea lanes of communication.
T-38 Partnership
The lawmakers also asked the Pentagon to study the possibility of a U.S.-India partnership for development of a replacement for the U.S. Air Forces T-38 trainer jet. The planes, built by Northrop Grumman Corp. (NOC)s predecessor, have been in use since the 1960s.
India has bought several U.S.-made weapon systems, including C-130J transports made by Lockheed, and on June 15 signed an order for 10 C-17 transport planes made by Boeing valued at about $4 billion.
The F-35 jet is still in development. At an estimated $382 billion, its the Pentagons most expensive weapons program. The U.S. Government Accountability Office has said the planes cost about $133 million each in todays dollars. The Pentagon plans to buy more than 2,400.
Buying F-35s at $133 million each would boost Indias cost in acquiring 126 fighters by about 50 percent, from a currently estimated $11 billion to almost $17 billion.
Future-Generation Aircraft
In April, when India shortlisted the European jet makers, V.K. Kapoor, a retired lieutenant general in Indias military, said the choice was driven by technical merits.
It was a by-the-book technical assessment that the American F-16 and F/A-18, despite their upgrades, are not future-generation aircraft, Kapoor said in April. They can remain current for another five or 10 years, but this deal is going to determine the operational capacity of our air force for the next 30 years.
Indias arms-buying process has been slowed by officials sensitivities over corruption scandals in previous purchases, including one that helped drive Prime Minister Manmohan Singhs Congress Party to defeat in 1989 elections, according to Rahul Roy-Chaudhury, senior fellow for South Asia at the International Institute for Strategic Studies in London.
Singhs government already has seen its legislative program stalled by opposition protests over alleged official corruption in the sale of telecommunications licenses and in last years staging of the Commonwealth Games in New Delhi.
