Procurement Structure
The Indian Air Force (IAF) is accelerating plans to finalise the record 114 Rafale fighter jet deal, targeted for completion by next year, with an estimated cost exceeding ₹2 lakh crore ($23.8 billion). Under the agreement, at least 18 aircraft will be delivered off-the-shelf from France in a short time-frame, while the bulk—over 90 units—will be assembled domestically with at least 60% indigenous content.
The first 18 Rafale fighters for India are set to be supplied off-the-shelf in a much shorter timeline, with direct fly-away delivery designed to rapidly strengthen the IAF’s frontline squadrons. These jets are expected to arrive significantly faster than traditional procurement schedules, bypassing the delays associated with local assembly and manufacturing ramp-up.
Procurement Strategy
India’s defence establishment opted for a direct government-to-government deal with France, prioritising quick induction of the first 18 Rafales in fly-away condition. This approach circumvents the MRFA tender and accelerates air force fleet modernisation, locking in an upfront batch built and shipped from Dassault’s French production line.
Technical Configuration
All 18 fighters will arrive ready for operational deployment, fully equipped with air-to-air Meteor missiles, Scalp cruise missiles, and designated Indian hardware upgrades, including some initial integration of “Made in India” components. Crews and ground support teams receive manufacturer-led training simultaneous to jet arrival, ensuring rapid frontline deployment and minimal lead time to IOC.
Operational Imperatives
The move comes as the IAF fleet has hit a historic low of 29 combat squadrons after MiG-21 retirements, against a sanctioned strength of 42.5 squadrons required to manage dual-front threats from Pakistan and China. The urgency was reinforced after Rafale’s strong performance in recent operations, including Operation Sindoor, where the jet demonstrated advanced capabilities such as defeating Chinese PL-15 missiles using the Spectra EW suite, and striking hostile targets with SCALP cruise missiles.
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Made-In-India
Dassault Aviation, in partnership with Indian firms—most notably Tata—is to set up a dedicated assembly line in India, supporting maximum local manufacture and technology transfer. Indian-made Rafales will also feature longer-range munitions and upgrades over the current F4 Standard configuration, along with a new Maintenance, Repair, and Overhaul (MRO) facility for the M-88 engines to be opened in Hyderabad.
Future Indigenisation
While the initial 18 aircraft are French-built, the contract encompasses future batches with substantial Indian content, aiming for around 60% indigenisation once local assembly begins, through a Dassault final assembly line in India. This ensures quick force augmentation now, with long-term manufacturing benefits as the programme matures.
This deal will boost the IAF’s Rafale fleet to 176 aircraft, combining the original 36 imported units with the new lot and the Navy’s order for 36 more. The direct deal also builds upon price and compatibility benchmarks previously established, helping the IAF avoid delays linked to evaluating alternative fighter types, and strengthening strategic autonomy by deepening Indo-French industrial ties.
Fast-tracking these deliveries allows India to swiftly reinforce squadrons at key bases, particularly Ambala and Hashimara, directly responding to evolving adversarial threats and capability gaps created by ageing platforms. The off-the-shelf option offers immediate air-power leverage while local manufacturing infrastructure is prepared for subsequent production phases.
Guarantees And Contract Structure
The deal mechanism includes sovereign guarantees from the French government, replacing bank guarantees, providing delivery assurance without the typical commercial risks tied to international aviation purchases. This negotiation structure is key to keeping timelines short and ensuring delivery pace does not falter post-payment.
Summary
The final contract signature is targeted for the next fiscal year, with off-the-shelf deliveries beginning soon after, while phased local assembly ramps up through 2029–30. The addition will ensure the IAF maintains a robust fighter force while indigenous programs—such as the TEJAS MK-1A and future fifth-generation fighters—come online post-2035.
IDN (With Agency Inputs)
Agencies
