Tata-Airbus given final nod for Avro replacement project

Bengaluru, May 14: Defence Minister Manohar Parrikar gave the go-ahead for a series of defence projects at Defence Acquisition Council (DAC) meeting late on Wednesday night.

Ministry of Defence sources told OneIndia that among the crucial decisions cleared were the all-important Rs 11,929 crore Avro replacement deal.

The Tata-Airbus consortium, which was the lone bidder in the deal can now heave a sigh of relief and begin the process of taking the operational phase of the project ahead.

The tender had sought foreign OEMs (Original Equipment Manufacturers) to identify an Indian partner other than HAL, to supply 16 aircraft from their original facilities and provide Transfer of Technology for manufacturing the remaining 40 aircraft by the Indian partner.

The Tata-Airbus consortium will have to deliver a total of 56 Avros (Airbus C295) to the Indian Air Force (IAF).

Among other key decisions cleared by DAC are: 145 M-777 ultralight howizers (Rs 2,900 crore), 200 Kamov LUHs (Rs 3,000 crore), six additional BrahMos units for Navy (Rs 2,700 crore) and seed money for Indigenous Aircraft Carrier-II (Rs 30 crore).

The DAC also decided to give the go-ahead to covert Air India's two Boeing 777ER aircraft for VVIP configuration and operationalise Defence Research Development Organisation-developed telemedicine concepts onboard naval ships.

"The government has now cleared all major projects aimed at mordernising the armed forces. Barring some small projects, which require some clarifications, the DAC has cleared everything," an official told OneIndia.

HAL finds no takers for its argument

The MoD's decision on Avro is seen as a major set-back to Hindustan Aeronautics Ltd (HAL) which had opposed the tender format right from the word go.

HAL argued in the last nine months with the MoD that the company is capable of building a robust aerospace ecosystem in the country by partnering with the private industries.

The company had sighted the Transport Aircraft Division in Kanpur as a proven facility capable of developing and manufacturing Avros and Dorniers.

HAL officials refused comment in detail on the DAC announcement. "These are government decisions and we have to abide by it," was the only comment an official would offer.

During Aero India 2015, the Tata group of companies had pitched hard to propel Prime Minister Narendra Modi's ‘Make in India' dream a reality through increased flow of investments into the domestic defence sector.

As reported by OneIndia, Mukund Rajan, a key official in the company had told media ahead of the show that the flow of foreign direct investment (FDI) in aerospace and defence has been very meagre in the last 15 years.

The company will have to now set up adequate infrastructure for making the 40 aircraft in India.