Money Matters, Simplified.
India to buy 10 Boeing C-17 aircrafts from US
by Jamie Anderson - June 7, 2011 - comments
During his visit in November, President Barack Obama, had urged the Indian government to purchase military hardware from the United States. The president had received the initial nod from Indian officials at that time.
Giving a go-ahead for the purchase of 10 Boeing C-17 Globemaster III heavy-lift aircrafts, the Cabinet Committee on Security in India has paved the way for the biggest ever defense purchase from the United States.
The $4.1 billion (INR 18,000 crore) deal will not only strengthen the India Air Force but will also boost the defense manufacturing industry in the country.
Potential for more business
As per the stipulations of the defense procurement policy, the Chicago, Illinois based Boeing will need to invest over $1 billion in India to fulfill the obligations.
The delivery of the new C-17s is expected between 2013 and 2015.
Ron Somers, president of US India Business Council (USIBC) was quoted by The Times of India, as saying, “This is testament to India's appreciation of US technology and confidence in the US as a long-term defence sales partner.”
Conventionally, India has purchased arms for its defense forces from Russia. The new C-17s will replace the fleet of Ilyushin Il-76 planes that the country acquired from the Soviet Union.
"This largest-ever Indian purchase of US defence technology, we hope, will be just the beginning of much more to come," added Somers.
Conventionally, India has purchased arms for its defense forces from Russia. The new C-17s will replace the fleet of Ilyushin Il-76 planes that the country acquired from the Soviet Union.
During his visit in November, President Barack Obama, had urged the Indian government to purchase military hardware from the United States. The president had received the initial nod from Indian officials at that time.
"This sale will double the value of U.S.-India defense trade and provide the Indian Air Force a strategic airlift and humanitarian response capability unique in the region," a State Department spokesman said.
Jobs saved at Long Beach factory
Meanwhile, the deal has also brought cheers at Boeing's Long Beach C-17 assembly plant. Workers were at risk of losing their jobs since there were no confirmed orders for 2012.
In January, Boeing had warned that it would cut 900 of the 3,700 jobs at the plant. The order from India has dispelled all those fears.
"The plant is abuzz. We knew the order was in the works. The extra planes will get us through 2012," said Stan Klemchuk, president of United Automobile, Aerospace and Agricultural Implement Workers of America.
"We know numerous, numerous countries are interested in planes in 2013, but 2012 was the gray year. This will allow us to make it through to 2013. It's huge" added Klemchuk.