SAAB, Adani Group announce collaboration for defence manufacturing

Swedish defence and security company SAAB and Indian conglomerate Adani Group have announced collaboration in defence manufacturing entailing billions of dollars of investment.
The partnership was announced mainly for design, development and production of single engine Gripen fighter jets under ‘Make in India’ if they win government contract to equip Indian Air Force (IAF) with new jets. They will compete with collaboration of US aircraft major Lockheed Martin and Tata Advanced Systems Limited (TASL) which are planning to manufacture F-16 fighter aircrafts in India.

Key Facts

The $12 billion Adani Group has interests in energy, real estate, logistics and fast-moving consumer goods (FMCGs), among others. It has no presence in the defence sector and nor does have experience in manufacturing space either.
SAAB is manufacturer of Gripen, a single-engine multi-role fighter aircraft featuring state-of-the-art technology, including advanced data links and sensors.

Background

IAF is expected to begin process for procuring 100 plus single engine fighter jets to replace ageing fleet of Russian Mig-21s and Mig-27s in service. The procurement will be under recently promulgated Strategic Partnership (SP) model of Defence Procurement Procedure (DPP). The deal is estimated to be worth over Rs. 60,000 crore.
Under this deal, first 18 aircraft will be brought to India in a flyaway mode and rest will be manufactured in India by Indian private company with technology transfer from foreign manufacturer. Only two aircrafts are available in global market to meet IAF’s requirement criteria viz, F-16 and Gripen.

Need for new aircrafts

The IAF needs minimum strength of 42 fighter squadrons to dominate and tackle two-front collusive threat simultaneously from China and Pakistan. Currently, IAF has 32 fighter squadrons. Further due to retirement of old aircraft, numbers will further go down by 2021. By then, 11 squadrons of Mig-21 and Mig-27, which are 35 to 45 years old, will be retiring from service. So to mitigate the shortfall, IAF is procuring new advance single engine fighter aircrafts.

Month: Current Affairs - September, 2017