Government concludes contract negotiations for Apache, Chinook choppers

Posted on 23rd Feb 2015 by mohit kumar

New Delhi, Feb 21 (IANS) The Indian government has concluded contract negotiations with US aerospace major Boeing for procuring 22 Apache AH-64E combat and 15 Chinook CH-47F heavy-lift helicopters.

Disclosing this, the IAF chief, Air Chief Marshal Arup Raha, told India Strategic defence magazine (www.indiastrategic.in) in an interview that the process for the final step, that is approval from the Cabinet Committee on Security (CCS), has now been initiated and that “once accorded, the contracts would be signed”.

Notably, all contracts above Rs.1,000 crore (approximately $165 million at the current exchange rate) in value have to be approved by the CCS, which is headed by the prime minister and includes the finance, defence, external affairs and home ministers.

Procedurally, once the ministry of defence (MoD) approves a proposal for forwarding the case to CCS, it has to be seen and signed by the defence minister and then goes to the finance ministry where likewise, the finance minister has to accord his signature. Any observations by the finance Ministry are generally addressed by the MoD before the case is put up to the CCS.

It normally does not take more than a couple of months once a file is moved for CCS approval. And if all goes well – which hopefully should – then the approval should be there in March or April.

The contract then can be signed on ASAP basis within weeks.

According to Air Chief Marshal Raha, all the contracted aircraft should be delivered within five years of the signing; the first one though is within three years.

India will have to pay 15 percent (or whatever is agreed) of the negotiated value at the time of the contract. Payments are then made in accordance with the delivery schedule.

Sources in the MoD indicated that negotiations were also on with Boeing for buying four more P-8I Long Range Maritime Reconnaissance (LRMR) aircraft as per the options clause, and most likely, the contracts for the helicopters as well as P-8Is should be through by mid-2015.

The Indian Navy has already bought eight P-8Is, of which six have been delivered and two are likely to arrive in India over the next few months. All these aircraft are being acquired on the Direct Commercial Sales (DCS) basis although their weapon systems like radars and missiles would be through the Foreign Military Sales (FMS) route from the US Government.

As for the the Apaches, Boeing’s Vice President for Defence, Space and Security in India Dennis Swanson has pointed out that the Indian Air Force (IAF) will be getting the very latest helicopter – the AH-64E – that has recently been delivered to the US Army. This version has 26 modifications over the earlier AH 64-D model.

The exact specifications for the Indian requirement are not known but normally, one in every three Apaches is equipped with Lockheed Martin’s sophisticated Longbow radar to acquire and designate targets for destruction. At present, IAF has very old Soviet vintage Mi-35 combat and Mi-26 heavy lift helicopters. They have done very well but have aged and need replacement with contemporary systems.