India readies $ 1 billion deal for additional GE engines from the US

India is readying a $ 1 billion deal for fighter jet engines from American manufacturer General Electric (GE) to power the indigenous Light Combat Aircraft (LCA Mk1a), additional orders for which were cleared by the Cabinet earlier this month.

Sources said that an order for 113 new F 404-IN20 engines is in the final stages of discussions between GE and Hindustan Aeronautics Limited (HAL) and is likely to be signed by next month.

This is separate from negotiations between the two companies for a larger deal to manufacture F 414 engines under a technology transfer agreement for next generation LCA Mk2 fighters. The complex agreement that promises over 80 percent transfer of technology is valued at over $ 1.5 billion.

The current deal for 113 engines has been in the works for several months, as HAL was poised to get additional orders for the LCA Mk1a. In the first tranche, the air force placed orders for 83 of the aircraft. For this, a deal was signed with GE in August 2021 to acquire 99 F 404 engines.

Deliveries under the $ 716 million engine deal have already commenced, though the engines faced a delay in timelines due to supply chain issues faced by GE. Indian manufacturer HAL says that the engine supply issues have now been resolved and it is on its way to receive two engines a month, which will be adequate to maintain production lines to produce 24 aircraft on an annual basis.

The order for 113 additional engines is being placed well in advance to ensure that there is no break in supplies and HAL is able to seamlessly move on to producing 97 more LCA Mk1a fighters that have been cleared by the Cabinet Committee on Security (CCS) earlier this month.

As reported, on August 19, the CCS cleared a Rs 66,000 crore order for 97 additional jets to be made by HAL, in a sign of confidence in the indigenous combat aircraft.

The LCA Mk1A procurement will add much needed numbers to the fighter jet strength of the air force and is much more capable that the earlier version, equipped with new age radars, electronic warfare systems and mid air refueling. Numbers are urgently needed as fighter squadron strength has dipped to its lowest since 1965.

The next version of the jet - the LCA Mk2 – is already under prototype production and will be powered by the GE 414 engine which will also be produced in India under a technology transfer deal. The first LCA Mk2 is expected to be ready for serial production by 2027. The MK2 will be capable of staying in the air longer than previous versions and will also have significantly more weapons payload capacity.

For the next generation Advanced Multirole Combat Aircraft (AMCA), the government in June invited Indian companies to take part in a competition to become developmental partners and build prototypes.