India will invite global competitive bids to select a foreign single-engine fighter to be made in India, said Defense Minister Manohar Parrikar.
Addressing a news conference here, Parrikar said the final selection for a western partner to provide a single-engine fighter for the Indian Air Force will depend on transfer of technology terms and the pricing proposed by the original equipment manufacturer.
Parrikar disclosed another single fighter line will be done under the Strategic Partnership model that will be announced later this month.
"We will submit a new acceptance of necessity proposal for new single engine fighters to Ministry of Defense in the next four months, and will request to fast-pace this new program," a senior IAF official said. "IAF will put up a demand for 200 new single engine fighters to be made in India, which will easily cost around $45 million apiece without weaponry."
The Strategic Partnership concept was mooted by MoD's Aatre Committee, which in its April 2016 report recommended appointment of select few private sector companies be designated as SPs.
However a top MoD official said selection of an Indian private company to manufacture single engine fighters will only be approved by the cabinet by the end of 2017. Thereafter a global bid will be floated, with expectation that Lockheed Martin of US and Saab of Sweden will pitch the F-16 Block 70 and Gripen, respectively.
The global tender will be floated in the first quarter of 2018. At that time, a private company will be nominated as the strategic partners production agency and a two or more year process will kick off to evaluate technical and financial bids and conduct extensive trials, MoD official noted.
The final government-to-government deal will be inked in 2021.
Currently, there is proposal to buy additional Rafale fighters, Parrikar announced, after an $8.8 billion deal was signed with France in September for 36 of the fighters.
IAF wants to replace its 11 aging Russia MiG-21 and MiG-27 squadrons in the next five to seven years. The service faces a shortage of fleet strength as it has around 34 operational fighter squadrons – 11 short of the 45 required to fight China and Pakistan at a future date.