The negotiations regarding the price of the GE F414 engines for India's Indigenous Light Combat Aircraft (LCA) TEJAS MK-2 are reportedly trending towards an increase. Initially, the deal was estimated at around $1 billion for 99 engines, including an 80% transfer of technology (ToT) from General Electric (GE) to Hindustan Aeronautics Limited (HAL). However, recent discussions suggest that the price may rise due to various factors influencing the negotiations.

Current Pricing Context

Initial Estimate: The deal was projected at approximately $1 billion, translating to about $10 million per engine.

Current Developments: Recent reports indicate that ongoing discussions may lead to a higher price point, although specific figures have not yet been finalized.

The increase in price could be attributed to several factors, including:

Market Dynamics: The global demand for advanced jet engines and the complexities involved in their production may influence pricing.

Technological Transfer: The significant ToT included in the deal is a critical aspect that adds value, potentially justifying a higher cost.

Strategic Considerations: The collaboration aims to enhance India's defense capabilities and establish a more self-reliant defense industry, which may also play a role in pricing negotiations.

The initial estimates set the deal at around $1 billion, current discussions indicate that the price for the GE F414 engines for the TEJAS MK-2 fighter jets is likely to increase as negotiations progress. The IAF has already ordered 83 TEJAS MK-1A fighters and is working for 97 more of these planes.

ANI