New Delhi: In a major ‘Make in India’ step, the government Wednesday cleared the long pending, nearly USD 3 billion-deal for procuring 56 C-295MW transport aircraft for the Indian Air Force (IAF). The aircraft will replace the ageing IAF fleet of Avro 748 transport aircraft that first flew in 1961.
The Cabinet Committee on Security, led by Prime Minister Narendra Modi, cleared the procurement, which will see 16 aircraft being delivered in flyaway condition from Spain within 48 months of signing of the contract.
The remaining 40 aircraft will be manufactured in India by the TATA Consortium within 10 years of signing the contract.
Incidentally, this is the first defence contract the European firm Airbus has signed with India since the 1960s despite being in the country for over five decades.
It is also the first project in India in which a military aircraft will be manufactured by a private company.
Cost negotiations were completed six years ago, but the deal was stuck due to finance issues and prioritisation of various other projects, including the Rafale deal. In this time though, there has not been any price escalation by Airbus, which tied up with TATA for the execution of the project.
In January, it was reported that the C-295 deal for a multi-role transport aircraft that can carry a maximum payload of 9.25 tonnes would likely be inked this year.
Boost to aerospace industry in India
All 56 aircraft will be installed with the indigenous Electronic Warfare Suite and the project will give a boost to the aerospace ecosystem in India wherein several MSMEs spread over the country will be involved in manufacturing parts of the aircraft, the defence ministry said in a statement.
In an interview with ThePrint this February, Rémi Maillard, president of Airbus India and the company’s managing director for South Asia, said the manufacturing of the aircraft domestically “will be the trigger to develop a total aerospace ecosystem in India”.
However, it is yet unclear where the Airbus aircraft will be built, though TATA has an aviation set up in Hyderabad.
Since its dimensions are smaller than the IAF’s fleet of C-130Js, C-17s and IL-76s, C-295s can take off and land at many airstrips and airports where the larger aircraft can’t.
Before completion of deliveries, ‘D’ Level servicing facility (MRO) for C-295MW aircraft is scheduled to be set up in India and it is expected that this facility will act as a regional MRO (maintenance, repair and overhaul) hub for various variants of C-295 aircraft, the defence ministry said.
It further said that in addition, Airbus will discharge its offset obligations through direct purchase of eligible products and services from Indian offset partners.
“A large number of detail parts, sub-assemblies and major component assemblies of aero structure are scheduled to be manufactured in India. The programme will act as a catalyst in employment generation in the aerospace ecosystem of the country and is expected to generate 600 highly skilled jobs directly, over 3,000 indirect jobs and an additional 3,000 medium-skill employment opportunities with more than 42.5 lakh man hours of work within the aerospace and defence sector of India,” the defence ministry said.
“It will involve development of specialized infrastructure in form of hangars, buildings, aprons and taxiway. During the process of manufacturing in India, it is expected that all the suppliers of TATA Consortium who will be involved in special processes, will gain and maintain globally recognized National Aerospace and Defence Contractors Accreditation Program (NADCAP) accreditation,” the ministry added.
(Edited by Manasa Mohan)