$8.63-billion advanced fighter aircraft project with Russia put on ice

Source: Business Standard, Apr 20, 2018

New Delhi: The proposal for India and Russia to jointly develop an advanced fighter — the eponymous Fifth Generation Fighter Aircraft (FGFA) — has been formally buried. Business Standard has learnt that National Security Advisor Ajit Doval conveyed the decision to a Russian ministerial delegation at a “Defence Acquisition Meeting” in end-February.

Doval and Defence Secretary Sanjay Mitra, who attended the meeting, asked the Russians to proceed alone with developing their fifth-generation fighter. They said India might possibly join the project later, or buy the fully developed fighter outright, after it entered service with the Russian Air Force.

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Airbus, Lockheed rush to tap India’s $620 billion defence market

download (2).jpgSource: LiveMint.com, Apr 11, 2018

New Delhi: For a country that’s known as the world’s biggest arms importer, India’s defence market is a notoriously difficult nut to crack.

Airbus SE hasn’t won a single military contract for half a century. Unperturbed, the European firm is building a supply chain in the South Asian nation; training and expanding a slew of existent part-makers that already help it build commercial jets. The hope is to easily meet local sourcing norms when, and if, it eventually wins an order.

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Rs 15,000 crore weapons purchase proposal approved by government

Source: The Economic Times, Feb 14, 2018

NEW DELHI: The Defence Acquisition Council (DAC) chaired by defence minister Nirmala Sitharaman on Tuesday approved proposals worth more than Rs 15,000 crore to acquire light machine guns, assault rifles and sniper rifles for the three forces.

The council approved the procurement of an “essential quantity” of light machine guns (LMGs) for the three services through the so-called fast track procedure, at an estimated cost of Rs 1,819 crore. The fast-track process is to meet urgent requirements of the regular and special forces.

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India and Cambodia ink 4 pacts to boost defence ties

Source: Business Standard, Jan 29, 2018

Chennai: India and Cambodia on Saturday inked four pacts, including one to improve cooperation in prevention, investigation of crimes and legal assistance in criminal matters, besides a line of credit from India to fund Cambodia’s Stung Sva Hab water resources development project for $36.92 million.

The pacts were signed after comprehensive talks between Prime Minister Narendra Modi and his Cambodian counterpart Samdech Hun Sen, who agreed to further enhance bilateral defence ties, including through exchanges of senior-level defence personnel and capacity building projects.

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After Qatar and Australia, Russia lowers LNG price for India

Source: Financial Express, Jan 16, 2018

New Delhi: After Qatar and Australia, India has got Russia to lower price of liquefied natural gas (LNG) to be imported from May that will help save millions of dollars in import bill. State gas utility GAIL India Ltd has convinced Russia’s Gazprom to lower price of gas under a 20-year deal as well as defer delivery of some of the quantities by 3-4 years, sources privy to the development said. GAIL had in 2012 signed a 20-year deal to import 2.5 million tonnes per annum of LNG from now-cancelled Shtokman LNG in the Barents Sea. Gas under this contract was indexed to average price of customs cleared crude oil imports by Japan, called Japan Customs-cleared Crude or JCC. Deliveries were to start from second quarter of 2018. Sources said the benchmark has been changed to Brent crude oil with lower indexation. Exact price changes were not immediately known. Also, deliveries have been staggered. GAIL will begin with 0.5 million tonnes (MT) buy in the first year, which will be ramped up to 0.75 MT in the following year and then to 1.5 MT in the year thereafter. Entire 2.5 MT would start flowing only in year four or five, sources said, adding that the quantities not taken initially would be bought during the remaining period of the contract. Gazprom will supply LNG from Yamal LNG project in the Arctic peninsula, they said, adding that supplies have been delayed due to weak demand at home.

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Defence ministry simplifies pvt firms’ role in developing weapon prototypes

Source: Business Standard, Jan 17, 2018

New Delhi: In an initiative that is being welcomed by small private defence firms, Raksha Mantri Nirmala Sitharaman on Tuesday simplified the “Make II” procedure, which is a framework for defence firms to develop and build equipment the military has announced it wants.

The “Make I” procedure is aimed at large, expensive projects like the Future Infantry Combat Vehicle. It provides for private industry consortia to develop such platforms, with the ministry reimbursing up to 90 per cent of the cost incurred.

In contrast, “Make II” is an industry-funded initiative for small projects that do not incur a heavy development cost. It allows private companies to develop equipment that the military has publicly stated it requires, in a document called the “Technology Perspective and Capability Roadmap” (TPCR), which is posted on the defence ministry website.

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$10-billion fighter deal hits tech-transfer air pocket

Source: The Hindu Business Line, Nov 06, 2017

New Delhi: India’s $10-billion single-engine fighter jet deal is believed to have hit a stumbling block over the contentious issue of transfer of technology (ToT) and equity participation. This is while negotiations are on for the purchase of more Rafale jets from France.

The two main contenders for the deal — Lockheed Martin and SAAB — have made it clear to the Defence Ministry that they will not go in for a complete transfer of technology (ToT) with 49 per cent equity participation in the joint ventures that they have inked with their respective Indian partners, sources told BusinessLine.

Under the defence foreign direct investment rules, global OEMs can invest more than 49 per cent with prior government approval. However, the fighter-jet deal has to be executed under the new ‘Strategic Partnership’ (SP) policy, and as per the norms laid out in this policy, it is the Indian entity that will have a controlling stake with 51 per cent.

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