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Combat aircraft deal to be finalised in six weeks

Last Updated: Friday, November 4, 2011 - 20:30

New Delhi: The multi-billion dollar deal to
procure 126 combat aircraft for the Indian Air Force (IAF)
entered its last phase on Friday with Defence Ministry opening
commercial bids of the two European contenders to determine
the lowest bidder, a process that is expected to take six to
eight weeks.
"The Contract Negotiations Committee (CNC) of the Defence
Ministry opened the commercial bids and read out the offers
made by the Eurofighter and Dassault Rafale in the presence of
their representatives. Now the Ministry will evaluate and
examine their proposals to arrive at the lowest bidder (L1),"
a Defence Ministry spokesperson said here.

The two contenders now know each other`s quote for the
bid but it will take another six to eight weeks for deciding
on the ultimate winner of the bid, Ministry sources said here.

As per the Defence Procurement procedure (DPP), the
bidder charging lowest price and meeting all the requirements
specified in the tender has to be offered the contract.

The Defence Ministry will now start calculating the Life
Cycle Cost (LCC) of the two aircraft, which is to be operated
for 40 years or 6,000 hours, they said.

Final commercial negotiations with the L-1 vendor (lowest
bidder) will begin before the contract is ready for signing
before the end of this fiscal.

Officials said the Government had earmarked Rs 42,000
crore for the deal in 2007 but after the negotiations, if it
is required, the funds can be increased significantly.
Decks were cleared for opening the commercial bids after
the Defence Acquisitions Council (DAC), chaired by Defence
Minister A K Antony, approved the offsets evaluation reports
of the Eurofighter Typhoon (backed by UK, Germany, Spain and
Italy) and the French Rafale jets on October 7.

In a surprise move, India had rejected two American
contenders from the race along with Russian and Swedish jets
on the basis of their performance in the field evaluation


First Published: Friday, November 4, 2011 - 20:30
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