Combat aircraft deal shortlist to be out soon

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SummaryThe race for the $10.6-billion contract for 126 medium multi role combat aircraft is going to gain momentum with the names of the shortlisted candidates expected to be announced by the first week of May.

The race for the $10.6-billion contract for 126 medium multi role combat aircraft (MMRCA) is going to gain momentum with the names of the shortlisted candidates expected to be announced by the first week of May.

This would follow the concretisation of offset policy by the government which will be released in the next week. The report of the technical evaluation tests of the six aircraft in fray was submitted to the defence ministry in July last year. However, since then the deal has made little progressed even as Indian Air Force chief Air Chief Marshal PV Naik asserted in February that the deal should be finalized by September.

The ministry sources have told FE the deal is again gathering steam with a concrete offset policy to be in place by April end.

“The shortlisted candidates for the MMRCA deal would be announced by beginning of May,” said a sourcefrom the ministry.

Following the announcement the commercial negotiations for the contract will begin.

The detailed policy is expected to concretise the opening of the civil aviation and internal security in more certain terms, so that there will be no room for confusion. The defence offsets policy is likely to bring in $10 billion during the 11th Five-Year Plan period (2007-11).

“The changes are likely to provide invitations to offer offsets proposals to be issued to only those vendors who are validated as technically qualified by the respective service. The shortlisted vendor will be invited for opening of their respective commercial bids,” a source said.

The ministry’s Technical Oversight Committee (ToC) is currently looking at the offset proposals submitted by the contenders for the deal.

Currently, both technical and commercial offset proposals need to be submitted by all vendors competing in a tender. Under the current policy, ToE will examine technical offset proposals, and the commercial offset proposals — submitted as sealed proposals — will be opened only when the respective commercial offer for the vendor is opened.

According to sources, the changes are being designed to help the MMRCA tender process, which is governed by the Defence Procurement Procedure (DPP) 2006 and plans to seek a legal route for approval to implement the revision with retrospective effect.

Simultaneously, their proposals for transfer of technology, critical for the rapid development of an Indian capability to build advanced fighters, are also being examined.

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