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Rediff.com  » News » India, US to ink arms deal worth Rs 10,700 crore

India, US to ink arms deal worth Rs 10,700 crore

March 17, 2009 11:18 IST

The United States has given the go-ahead for a $2.1 billion sale of eight Boeing Co P-8I maritime patrol aircraft to India -- the largest arms sale by the US till now.

On March 12, the State Department informed the US Congress that it had decided to clear the sale after factoring in 'political, military, economic, human rights and arms control considerations'.

The P-8 is a long-range maritime reconnaissance and anti-submarine warfare aircraft, which can operate effectively on land or water while performing anti-submarine warfare; search and rescue; maritime interdiction and long-range intelligence, surveillance and target acquisition, claims Boeing.

The Indian navy, its first international customer, opted for the patrol aircraft after reviewing its various rivals, including the EADS Airbus A319.

Boeing has said it would deliver the first P-8I in 48 months of sealing the deal and the remaining seven by 2015.

The P-8I is reportedly similar to the P-8A Poseidon, which is being developed for the US navy.

The previous biggest arms deal between the two countries was signed in January 2008, when the Indian government gave the nod for the purchase of six C-130J Super Hercules transport aircraft, at an estimated cost of Rs 4,000 crore

As per the new deal, Boeing will supply support equipment, requisite training and logistical support till June 2019, said the State Department.

Boeing is currently competing with arms manufacturer Lockheed to sell India 126 new multi-role fighters. The deal may cost India's Ministry of Defence a staggering $10 billion.