Indian Economy News

India is set to begin ambitious defence projects valued at Rs. 1.4 trillion (US$ 17 billion)

  • IBEF
  • November 28, 2023

India is set to grant preliminary approval for three major indigenous projects that have a combined value of about Rs. 1.4 trillion (US$ 17 billion). These projects include the construction of an additional aircraft carrier, 97 additional Tejas fighters, and 156 Prachand light combat helicopters.

During a meeting scheduled for the end of the month- November 30, 2023, the Defence Acquisitions Council, directed by Mr. Rajnath Singh, the Defence Minister of India, is anticipated to initiate the "acceptance of necessity (AoN)"—the initial step in the procurement process. The procurement process will move forward with tender and commercial negotiations after the AoNs, and the three deals will ultimately be submitted to the Cabinet Committee on Security for final approval.

Among these projects is the 97 Tejas Mark-1A fighters, whose cost is estimated to be around Rs. 55,000 crore (US$ 6.59 billion). These fighters will complement the 83 aircraft that have been already ordered under a contract with Hindustan Aeronautics (HAL). In order to fill the current shortfall in fighter squadrons, the Indian Air Force needs these additions.

The second indigenous aircraft carrier (IAC-2) is expected to be built at the Cochin Shipyard for approximately Rs. 40,000 crore (US$ 4.79 billion), following a "repeat order" of INS Vikrant (IAC-1). The construction of IAC-2, with a tonnage of 44,000 tonnes, will take 8-10 years. India's need for carrier-based aircraft is currently met by the MiG-29K jets, with further plans for the acquisition of Rafale-Marine fighter jets.

At an estimated cost of Rs. 45,000 crore (US$ 5.39 billion), the 156 Prachand helicopters would be utilised for offensive operations in high-altitude regions including eastern Ladakh and Siachen Glacier. Armed with a variety of weapons, these helicopters will augment the current fleet that was brought in under a prior contract.

Budgetary restrictions forced the use of the smaller electric-propelled IAC-2, but China is still developing and operating two aircraft carriers. On the other hand, the US has 11 nuclear-powered carriers that can individually accommodate a sizable number of fighters and planes. For this reason, these defence initiatives are essential to improving India's readiness.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.