By IANS
New Delhi : US aerospace major Boeing has upped the ante for aircraft sales to the Indian armed forces by inking a $1 billion pact with state-owned Hindustan Aeronautics Limited (HAL) to bring new manufacturing work here over the next decade.
Under the pact signed here Thursday, Boeing and HAL will explore opportunities to shift work packages to India with an initial value of $10-$20 million per annum and increase this as business prospects develop, top officials of the two companies separately said.
The agreement, signed by Boeing Integrated Defense Systems (IDS) CEO Jim Albaugh and HAL chairman Ashok K. Baweja, provides for sharing key Boeing business and manufacturing tools with HAL.
“The agreement represents an important step in our efforts to build solid long-term partnerships in India to make Boeing products more globally competitive, while allowing HAL to grow and expand its potential market around the world,” Albaugh told reporters.
“This is a significant step by two aerospace leaders that opens up new avenues and areas of co-operation,” Baweja said in a statement.
“HAL and Indian industry gain from this long-term business arrangement in terms of technology upgrade, while Boeing can look forward to a reliable source for its product requirements,” he added.
The pact covers the manufacture by HAL of sub-systems for a wide range of Boeing products like the F/A-18 Super Hornet combat jet, the CH-47F heavy-lift Chinook helicopter and the P-8A multi-mission maritime aircraft the company hopes to sell to the Indian Air Force (IAF) and the Indian Navy.
“There are no strings attached,” Albaugh hastened to add when asked whether the new pact was linked to the sales pitch the company has made for its products.
However, a Boeing statement issued here made it apparent that the company hoped the pact would give it a head start over its competitors.
“Boeing also will support HAL in developing manufacturing processes and capabilities needed for the production of hardware for Boeing and/or its subcontractors,” the statement said.
“Boeing also will support the training and transfer of Boeing best practices for lean principles and supplier and program Management to the extent allowed by the US government and Boeing corporate policy,” the statement added.
HAL, according to the statement, “agrees to offer Boeing competitive pricing, to invest in the required manufacturing infrastructure, and to join Boeing in seeking recognition by the government of India for the value of the work packages and technology transfers in support of credits against existing or future offset obligations”.
Speaking about the IAF tender for 126 combat jets that was floated in September, Albaugh said: “We will respond on March 3 (2008) after which we expect the technical evaluation process to stretch to 2009-10.”
Significantly, he stated that Boeing was “moving forward” to seeking US government approval for also transferring technology for the AESA (active electronically scanned array) radar if it wins the F/A-18 order.
In February, the company had flatly said the AESA technology would not be transferred. In simple terms, the radar gives the F/A-18 incomparable detection, targeting, and tracking capabilities, increases aircrew effectiveness and protection, and readies the aircraft for future network-centric operations.
The F/A-18 faces five competitors: the US Lockheed Martin F-16, the Russian MiG-35, the French Rafale, the Swedish Grippen and the Eurofighter manufactured by a four-nation European conglomerate.
As for the maritime reconnaissance aircraft, of which Boeing has offered the P8I (India) variant, Albaugh said the Indian Navy had “sought clarifications that are being addressed”, adding that he hoped a final decision would be taken by early next year.