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BANGALORE, India: India will soon invite bids from aviation companies for the purchase of 126 combat jets, the country's defence minister said on Wednesday, in a deal valued at close to $10 billion.
“It (the request for proposals) is almost in the final stage. I can assure you it will be at the earliest,” A.K. Antony told a news conference in Bangalore at the start of an air show where companies such as Boeing Co. and Russia's MiG are displaying their aircraft.
“We feel that the modernisation (of armed forces) is the most important agenda of the government … By a strong deterrent only we can prevent even a war.”
India raised its defence spending by 7 percent to $20 billion for the year ending March 2007.
Antony said the government would procure $8 billion to $10 billion worth of defence equipment in the next five years as part of its modernisation programme.
India, which has one of the biggest air forces in the world, wants to replace its ageing MiG-21s and British Jaguar planes, prompting aviation firms to flock to Bangalore this week.
The 126-plane deal has attracted interest from European players like France's Dassault which is promoting its Rafale fighter and Sweden's Saab, eager to sell its JAS-39 Gripen.
The Russians are pushing their cutting-edge MiG-35 which they have brought to the Bangalore air show. Boeing's F/A-18 Super Hornet and Lockheed Martin's F-16 are also competing for the contract.
Eurofighter, which is made by a consortium of European aircraft makers including Airbus parent EADS, Britain's BAE Systems and Italy's Finmeccanica, said on Wednesday it would aggressively compete for the Indian order.
Boeing estimates the Indian defence market to be worth around $10 billion to $15 billion in the next decade.
