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India Defence Online, New Delhi — The US based aviation giant General Electric has bagged the prestigious $800 million contract for the supply of 99 engines for India’s ‘Tejas’ Light Combat Aircraft (LCA). The two year old saga for choosing the appropriate engine for ‘Tejas’ LCA came to end after the Defence Research and Development Organisation (DRDO) formally announced that General Electric was the lowest bidder in the tenders.
General Electric’s GE F-414 engine beat Eurojet’s EJ-200 engine in the race for the DRDO’s mark II version of the LCA. The DRDO indicated that after evaluation and acceptance of the technical offer provided by both Eurojet and GE Aviation, the commercial quotes were compared in detail and GE Aviation arose as the lowest bidder.
The price negotiating committee held several meetings for clarifications with Eurojet and GE representatives since the commercial bids were opened and finally the GE engine was found to be cheaper. The DRDO added that further price negotiations and contract finalisation will follow.
Evidently, Eurojet is unhappy at the current turnaround of events and feels that the decision has been unfair to them. Eurojet claims that that a revised bid which was submitted to them was not taken into account. In fact, an earlier bid by Eurojet was actually less than that of the General Electric. However, DRDO sources say that there were other expenses added on to the Eurojet bid which made it expensive. This included the cost of extra transfer of technology that the company had offered and the price of tooling to build the engine in India. Eurojet indicated that it needs further details from Indian authorities and more information about the process leading to the announced selection.
After factoring in various clarifications and careful analysis, General Electric has been given the contract for equipping the ‘Tejas’ LCA Mk II aircraft with a customised version of its GE-414 engines. According to the Indian Air Force (IAF), the earlier GE-404 engines were not providing enough power to the LCA. Hence, General Electric is providing a customized version of the engine in the form of a GE-414 engine. The company will start equipping the aircraft with its engine in the next two and a half years.
As for the Indian Defence Ministry, it has indicated that negotiations with GE will continue at least until mid-2011. After that, General Electric will have 121 days (plus an allowable extension of two months) to obtain permission from the US government for the transfer of technology in order to build the engine in India.
As for Eurojet, it feels that General Electric may not be able to live up to the Indian requirement since transfer of technology for the engine may not be granted to General Electric by the US government. Hence, Eurojet is still keeping its fingers crossed as the engine contract may eventually end up with them.
Indian defence news and strategic intelligence
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