India, US may ink $5.8-b aircraft deal ahead of Obama’s visit

BANGALORE: India and the United States are close to signing their biggest defence deal so far, just ahead of President Barack Obama’s visit to India early next month. According to sources, both countries are looking to get the $5.8-billion Boeing C-17 Globemaster-III transport aircraft deal signed just before Obama’s maiden visit to the country, thereby clearing the deck for a formal announcement.

However, in a separate twist, the deal could see India getting the ten C-17 Globemaster-III airlifters without a number of electronic systems, due to New Delhi’s steady refusal to sign two critical strategic security agreements, the Communications Interoperability and Security Memorandum of Agreement (CISMOA) and the Basic Exchange and Co-operation Agreement for geo-spatial co-operation.

While Boeing has said that India will get the most-updated version of C-17, speculation is rife that the country has already approached Israel and France to buy the necessary equipment as an alternative.

“The agreements don’t really matter, because India can approach Israel or France for it. But, it could get more expensive once you replace military-grade equipment with commercial-grade,” sources told ET. Recently, air chief marshal PV Naik also reiterated that the Indian Air Force’s operational capabilities will not be affected even if the country does not sign the two agreements. While negotiations are currently on at a feverish pace between the two governments, the details of the Globemaster-III agreement are yet to reach the finance minister’s office.

Once it’s approved, it will come before the Cabinet Committee on Security, which will give the final clearance, before the deal is announced.