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SOURCE: RAUNAK KUNDE / NEWS BEAT / IDRW.ORG

Negotiations between General Electric (GE) and Hindustan Aeronautics Limited (HAL) for the local manufacturing of the F-414 engines have encountered a significant hurdle. Sources at idrw.org have revealed that GE has demanded an increase in the contract price to incorporate 80% Transfer of Technology (ToT) for the engines.

The price for manufacturing 99 F-414 engines in India, which was earlier agreed upon at $1 billion, has now escalated to approximately $1.5 billion, a difference of $500 million. This sudden price increase has caused delays in finalizing the deal, as price negotiations remain ongoing.

Despite this, HAL remains optimistic about concluding the engine deal with GE before the end of March 2025. However, the ongoing discussions over the revised pricing could extend the timeline, as both parties work toward reaching a mutually acceptable agreement.

The F-414 engines are critical for India’s Tejas MkII program, and local manufacturing is expected to bolster the nation’s self-reliance in defense production. The higher percentage of ToT would be a significant step forward in advancing India’s indigenous capabilities in jet engine technology.

While this development has created an obstacle in the negotiation process, HAL’s confidence in closing the deal reflects its commitment to ensuring the program stays on track, even amid challenging negotiations. Further updates are awaited as discussions progress.

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