India’s Ministry of Defence has concluded price negotiations with Airbus to acquire 62 Airbus C295 medium transport aircraft for the Indian Air Force (IAF). In a chat with BW Businessworld’s Manish Kumar Jha, Airbus Defence & Space CEO, Dirk Hoke spoke about how the deal will help create thousands of jobs and a robust local supplier base with capabilities to support indigenous production.

Under the medium transport aircraft (MTA) program, India’s Ministry of Defence (MoD) has concluded price negotiations to acquire a total of 62 Airbus Defence and Space’s C295 MTA for the Indian Air Force (IAF) and the Indian Coast Guard (ICG). When are you expecting the closure? How are you going about setting up the infrastructure?

We expect a positive decision from the Indian government in the coming months. Clearly, we have the best platform to meet the specifications of the AVRO aircraft replacement program. The C295 will allow the IAF and the Coast Guard to maintain and amplify their missions with all the guarantees, as well as implement the aerospace industry in India through our agreement with TATA. The industrial setup continues its development. We have worked together with our colleagues at TATA over the last two years to offer the best solution to both the IAF and the country’s industry.

How does Airbus look at the IAF’s requirement for air-to-air refuelling?

Airbus is actively engaged to address the IAF’s air-to-air refuelling needs and we are looking forward to a formal request for proposal (RFP). The A330 Multi Role Tanker Transport (MRTT) is capable of fully addressing the IAF’s needs. It is noteworthy that in both previous competitions, it has been rated the best tanker.

Airbus and Dassault Aviation are jointly working for the Future Combat Air System (FCAS) program. India does have a significant interest in working on the next-generation fighter combat program. Do you see any common thread with India as a partner?

The FCAS is a program currently run by three European countries namely Germany, France, and Spain. It is clearly the nations and not the industry that will decide who will join FCAS. But the first intention is to define a clearly European approach on the next-generation air power. Irrespective of FCAS, Airbus could offer vast experience in fighter aircraft development, boosting India’s ambitions.

How do you look at the defence acquisition policy in India? What is the best way to leverage the offset discharge for building capabilities?

Over the years, technology and know-how from Airbus have not only catalysed the growth of India’s civil aviation sector but also supported the modernisation of its armed forces. Given our convincing track record of developing our Indian industrial partners, we are uniquely positioned to link them together in a tightly knit and vibrant aerospace sector. We have proposed multiple projects to kick-start a defence-focused industrial ecosystem in the country, including offers to build the C295W military transport aircraft along with TATA and a partnership with Mahindra Defence to manufacture military helicopters locally. The execution of these projects will help create thousands of jobs and a robust local supplier base with capabilities to support indigenous production.

India’s defence industry received foreign direct investment (FDI) of a meagre $2.18 million in 2018-19. Being one of the leaders in aerospace, could you share some of the measures that can make India a more favourable destination?

For Airbus, India already takes a centre-stage role in our international activities and we want to further increase its contribution to our products. We are fully geared to support the Indian government’s efforts to develop and strengthen the country’s aerospace, engineering, and production capabilities and take our partnership to new heights. In defence, our proposition is to develop a focused industrial ecosystem in the country with our partners at the heart of it. However, much of this will depend on the contracts. There is a huge demand for defence helicopters and airplanes from the Indian military and security forces that can be served by some of our products.