NEW DELHI --- India will not sign a multi-billion dollar contract to buy European fighter jets before the fiscal year ends in March, the defence minister said on Tuesday, about a deal to revamp ageing weapons in line with the country's rising global influence.
"Not this financial year," Defence Minister A.K. Antony told Reuters in reply to a question about when the deal that has been in the works since 2007 would be signed.
However, India will "soon" announce the lowest bidder for the tender for 126 jets worth up to $15 billion, two government sources with knowledge of the deal told Reuters.
One of the sources said France's Rafale jet was the likely winner, adding that the defence ministry was now considering buying another 80 or so jets and could invite bidders excluded from the current process to take part.
Dassault's Rafale is competing with the Typhoon fighter made by four-nation consortium Eurofighter in what is currently one of the largest global weapons tenders.
"It is a long process. The file has not come to my table," Antony said, adding that the finance ministry and a cabinet panel headed by the prime minister have to look at the agreement after he signs off.
One defence ministry source with knowledge of the negotiations said the life-time cost of the tender including training and maintenance may reach $15 billion.
Previous estimates put the cost around $11 billion.
The defence ministry source said each Rafale was $4 million to $5 million cheaper than its rival and the plane was preferred by the Air Force.
"Unit-wise, the French plane is much cheaper than the Eurofighter. Moreover, the Indian Air Force, which is well-equipped with French fighters, is favouring the French fighter," said the source, who asked not be named.
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