Mega defence deal - C-295 Aircraft

56 C-295 MW medium transport aircraft are being procured now for the Indian Air Force (IAF)

 Mega defence deal - C-295 Aircraft

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• The story: The Cabinet Committee on Security (CCS) cleared the procurement of 56 C-295 MW medium transport aircraft for the Indian Air Force (IAF) under the Make-in-India initiative in the aerospace sector. It is being considered one of the big deals in this space.
• Details: The C-295MW aircraft will be purchased from Airbus Defence and Space S.A., Spain. It is a transport aircraft of 5-10 tonne capacity with latest technology, and has a rear ramp door for quick reaction and para-dropping of troops and cargo. It will be installed with the indigenous Electronic Warfare Suite. It will replace the Indian Air Force’s ageing fleet of Avro-748 planes, a British-origin twin-engine turboprop, military transport and freighter with a 6-tonne freight capacity.
• Who got the deal: 'Airbus Defence and Space' and 'Tata Advanced Systems Limited (TASL)' will jointly execute the project under the Make-in-India initiative in the aerospace sector. Airbus will supply the first 16 aircraft in fly away condition while the remaining 40 will be assembled in India by TASL.
• Why deal is important: This is the first project of its kind in which a military aircraft will be manufactured in India by a private company. During manufacturing in India, all the suppliers of TATA Consortium who will be involved in special processes will gain and maintain globally recognized National Aerospace and Defence Contractors Accreditation Program (NADCAP) accreditation.

1. Atmanirbhar Bharat Abhiyan - It is an opportunity for the Indian private sector to enter into technology intensive and highly competitive aviation industry.  This is a unique initiative to strengthen indigenous capabilities and boost ‘Make in India’.
2. Boost for MSMEs - The project will boost the aerospace ecosystem in India wherein several Micro, Small and Medium Enterprises (MSMEs) spread over the country will be involved in manufacturing of parts of the aircraft.
3. Cut import dependence - The project will augment domestic aviation manufacturing resulting in reduced import dependence and expected increase in exports.
4. New jobs - The programme will act as a catalyst in employment generation in the aerospace ecosystem, with 600 new highly skilled jobs and 3000 indirect jobs and an additional 3000 medium skill employment opportunities.
5. Infra development - It will involve development of specialized infrastructure in the form of hangars, buildings, aprons and taxiways. Before completion of deliveries, ‘D’ Level servicing facility (MRO) for C-295MW aircraft are scheduled to be set up in India. The facility will act as a regional MRO (Maintenance, Repair and Overhaul) hub for various variants of C-295 aircraft.

• Offset Obligations: Airbus will discharge its offset obligations through direct purchase of eligible products and services from Indian offset partners giving further boost to the economy. The "offset" is an obligation by an international player to boost India’s domestic defence industry if India is buying defence equipment from it.
• EXAM QUESTIONS: (1) What is the idea behind Make in India in defence sector in India? Explain. (2) What are the various ways offset obligations may be fulfilled by foreign sellers of defence equipment, to India? Explain.

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