The nearly Rs5,000-crore deal is under negotiation with the United States government under its foreign military sales (FMS) programme.
Talks on with US under foreign military sales programme
NEW DELHI: Will India end up overpaying for six American Hercules transport planes? The nearly Rs5,000-crore deal is under negotiation with the United States government under its foreign military sales (FMS) programme.
Some sources within the government told DNA that the base price of C-130J Hercules aircraft was around $75 million until three years ago. But the basic plane would now cost India over $150 million. The total deal would be worth around Rs4,800 crores ($1.2 billion), including a huge amount of spares, training etc.
Adding grist to the over-pricing mill is an offer from an Italian manufacturer to sell its transport aircraft, which is half the size of the Hercules but more modern, for just $35 million each. Representatives of the Italian firm, Finmeccanica, argue that their C-27J has been selected even by the American forces and can do everything that the Indian Air Force wants. And it costs only a fraction of what the Hercules does, even to operate.
A couple of sources in the Indian Air Force that DNA spoke to also believe there is merit in the arguments of the Italian company and the concerns that India is paying too much for the Hercules. “We really need to take a hard look to see if the FMS route is beneficial at all,” says a senior IAF officer.
The FMS programme refers to government-to-government purchases of weapons from the US, without directly dealing with the manufacturer.
The FMS route helps the Indian government avoid the complicated tendering process, because it comes with the assurance of the US government. India follows a similar method with Russia. But the field of government-to-government defence deals is getting crowded, with the French expected to make a similar offer on helicopters in the run-up to President Nikolas Sarkozy’s visit.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}