India has asked two European defense firms shortlisted for its $10.4 billion tender for 126 combat jets to extend their commercial bids till December 31 and has given them two weeks time to do so, an official said Thursday.
The Indian Air Force (IAF), for whom the 126 Medium Multi Role Combat Aircraft (MMRCA) are being bought to replace its aging Soviet-era MiG-21 fighters, has conveyed to European consortium EADS Cassidian and French firm Dassault to extend their commercial bids that were to expire Thursday, the defense ministry official said.
EADS is offering the Eurofighter Typhoon and Dassault the Rafale.
India has also conveyed to the other four contenders for the contract, described as the “mother of all defense deals”, that they were out of the race, the official said, speaking on condition of anonymity.
American Boeing’s F/A-18 and Lockheed Martin’s F-16, Russian United Aircraft Corporation’s MiG-35 and Swedish SAAB’s Gripen were the firms whose bids were rejected and it was conveyed to them that their aircraft did not clear the flight and weapons evaluation trials completed in April 2010 on 643 parameters.
“With this down-select, we have completed a major milestone in the MMRCA acquisition process,” ministry spokesperson Sitanshu Kar said when asked for his reaction to the development.
Other officials said the process of selecting the winner of the MMRCA deal would be completed before the March 31 2012 end of this fiscal.
The ministry will carry out a “benchmarking” of the prices of the two down-selected firms to arrive at a reasonable price for their aircraft before the commercial bids are opened and this could take some three to six months.
“Only after the benchmarking is done would the commercial bids of the two firms be opened. The L1 — the lowest cost among the two bids — would be chosen after this benchmarking and cost negotiation process would begin with that firm,” the official said, indicating that the contest for the major deal is not yet over.
Separately, the defence ministry would carry on negotiations with the two firms on their plans to fulfill their offsets commitments. India has fixed 50 percent offsets for the MMRCA deal to ensure that half of the deal’s worth or about $5 billion is reinvested in India to energize its defence industry.
A day after India informed the four contenders who are out of the fray, none of them have, so far, petitioned the defense ministry for re-consideration of their case, the official said, when specifically asked about this.