India is now exploring as an alternative the stealth fifth-generation fighter aircraft (FGFA) from Russia as negotiations on Rafale fighter jet deal have run into rough weather recently, leading to delay in finalisation of the contract for supply of 126 fighter planes.
The main issue concerns the pricing, which is basically the production cost in India, and Dassault's reluctance to stand guarantee for the 108 fighters to be built by state-run HAL. Rafale was selected for the deal in 2012 but the final contract is yet to be signed.
French Defence Minister Jean-Yves Le Drian held talks in Febraury with his Indian counterpart Manohar Parrikar to salvage the multi-billion Rafale contract even as a deadlock continues to hold up the deal.
The IAF which currently operates 34 fighter squadrons as opposed to the required 44 squadrons is in urgent need of new aircrafts to replace it's aging fleet of Mig-21 and Mig-27.
A source quoted in Times of India said, "We have agreed to a lesser work-share for a realistic contract, with the initial lot of the FGFA being imported and the rest being made here under technology transfer."
The FGFA is the biggest ever bilateral Indo-Russian defence cooperation project. The preliminary design agreement on FGFA was signed in 2010 between HAL and Russian Sukhoi Design Bureau to build the jet for use by both countries with India investing 50 per cent of the cost of the multi-billion dollar programme.
The aircraft is based on the Russian Air Force's Sukhoi T-50 PAK-FA platform and the Indian version is expected to carry more advanced features. The project is seen as giving a boost to India's indigenous capabilities to develop advanced fighter aircraft.
Demonstration flights of the FGFA were watched by ex Secretary Defence Production R K Singh and ex IAF Chief, Air Chief Marshal P V Naik back in 2011.
The fifth generation fighter is expected to be delivered from 2017 onwards with the IAF expected to induct over 300 aircraft in the next two decades.