With the $2.4 billion Mirage-2000 upgrade deal with France in its final stages, India's defence ministry and air force top brass seem to be split over the high costs and likely benefits to the country's future air power needs.
With the contract papers said to be headed to the Cabinet Committee on Security (CCS), the volume against the deal is rising, top officials told IANS here.
Among points of contention is the deal cost to upgrade the 52 Mirage-2000 combat aircraft by French company Dassault Aviation. Taking into account $1 billion for new weapons and another $500 million for new facilities at Bangalore-based Hindustan Aeronautics Limited (HAL) for the upgrade, the cost could rise to $3.9 billion, the officials said.
"The upgrade programme will cost the Indian exchequer $7.9 million per Mirage-2000 aircraft. But India is buying 126 new Medium Multi-Role Combat Aircraft (MMRCA) under a $10.4 billion tender that is to be finalised in this fiscal.
"The cost of the new fourth generation fighter jet works out to $7.9 million per plane. Is it prudent to pay the same price for a swanky new plane and just an upgrade programme for a 25-year-old plane?" said a senior defence ministry official.
Confirming the raging debate, Indian Air Force (IAF) officers said this was the reason the contract has not seen the light of the day yet, though it has been in the pipeline for years now.
There was a strong push for the deal when French President Nicolas Sarkozy's visited India in December 2010 and the country's Defence Minister Gerard Longuet was here in May this year.
Among the upgrades planned for Mirage-2000 under the contract include night vision goggle compatible glass cockpit, advanced navigational systems, advanced Identify Friend or Foe (IFF) system, advanced multi-mode multi-layered radar, fully integrated electronic warfare suite and advanced beyond visual range (BVR) capability. The new weapons include 450 MICA interception and aerial combat missiles.
French firms Thales and MBDA will be the weapons systems integrator and missiles supplier respectively.
"In fact, Thales and MBDA were initially quoting much more," said IAF officers. "But even at this cost and age, an upgraded Mirage can operate efficiently for another 20 years and still be a potent, frontline fighter jet. The upgrade of the Mirages would provide it a fourth generation combat jet capability," the officers told IANS, requesting anonymity as they were not authorised to speak to the media.
India bought 52 Mirage-2000s in 1982 and fully inducted these into the IAF in 1986. Two of the planes will be upgraded in France, another two in India with French help, and the rest 48 entirely by HAL.
Another issue is the nine-year timeframe given by Dassault, the original equipment manufacturer (OEM) of Mirages, to complete the upgrade.
"In comparison, the same firm is quoting deliveries of just six years if it wins the MMRCA deal, on the lines of what its competitor in the final fray, EADS, too has quoted," officials noted.
"Not only will the upgraded Mirages cost as much as a brand new twin-engine fourth generation fighter, but some of the Mirages will be 35 years old by the time they are upgraded," they said.
Dassault, officials said, had in the original 1982 contract guaranteed 30-year plus 10-year life for the planes. "Thus the upgraded Mirages will have just another five years of service left, provided there is no time or cost over-runs. Then why spend a fortune?" they asked.
IAF officers also noted that Israel had also offered to upgrade the Mirages, but at half the price. But the defence ministry quoted an old policy that only OEMs could carry out an upgrade.
"The same ministry has called for competitive bids in recent months for equally complex fighter aircraft, particularly those from Russian or erstwhile Soviet stable," they said.