Lock­heed of­fers to build F-16 jets in In­dia

The Pak Banker - - BUSINESS -

Lock­heed Martin Corp. has of­fered to build its flag­ship F-16 fighter jet in In­dia, as the South Asian na­tion scram­bles to mod­ern­ize its ag­ing de­fence fleet while try­ing to es­tab­lish the coun­try as a man­u­fac­tur­ing base.

Lock­heed chair­man, pres­i­dent and chief ex­ec­u­tive of­fi­cer Mar­il­lyn Hew­son made the of­fer to In­dian Prime Min­is­ter Naren­dra Modi in Septem­ber, Phil Shaw, CEO of Lock­heed's In­dian unit, said in an in­ter­view on Thurs­day at the Sin­ga­pore Air­show. The US and In­dian gov­ern­ments are ne­go­ti­at­ing the deal, he said.

Modi needs to quickly re­place many of the air force's 650 planes - a third of which are more than 40 years old - and has vowed to turn In­dia from the world's big­gest weapons im­porter into a global hub for de­fence man­u­fac­tur­ing. The coun­try sold about $150 mil­lion of arms in the last fis­cal year, a frac­tion of the $ 64 bil­lion in world­wide de­fence trade and its own arms im­ports of $5.6 bil­lion.

"The US-In­dian re­la­tion­ship that has been de­vel­op­ing could ben­e­fit Lock­heed," Jon Gre­vatt, Asia-Pa­cific de­fen­cein­dus­try an­a­lyst for IHS Jane's, said by phone from Sin­ga­pore. But, he added, "I don't see it hap­pen­ing im­me­di­ately. This is still very early stages."

Af­ter com­ing to power in May 2014 with the coun­try's big­gest elec­tion man­date in three decades, Modi un­veiled his '' Make in In­dia'' cam­paign to boost man­u­fac­tur­ing to 25% of gross do­mes­tic prod­uct by 2022 from 18% now. The cor­ner­stone of the pol­icy is at­tract­ing com­pa­nies to set up fac­to­ries in In­dia for man­u­fac­tur­ing.

In­dia picked Paris-based Das­sault Avi­a­tion SA in 2012 to build 126 war­planes at an es­ti­mated cost of about $11 bil­lion - at the time the world's big­gest fighter- jet deal, and one in which Lock­heed lost out. As talks stalled over price and qual­ity guar­an­tees, Modi flew to France last April and sought to di­rectly buy 36 fighter jets from the French govern­ment in a bid to speed things up.

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