Defense firms vie for India orders at air show

By @ibtimes on

Global defense manufacturers, competing to sell products to one of the fastest growing aircraft markets in the world, are poised to unveil new products at India's biennial air show and fight it out for one of the largest export orders in the history of defense.

Boeing , Lockheed Martin , Northrop Grumman , Saab and EADS unit Cassidian are among those attending the event in the southern city of Bangalore, where Boeing will unveil an advanced version of its F/A-18 Super Hornet fighter aircraft.

The Boeing aircraft is in the race for an order of 126 fighter jets from India, which is looking to spend up to $50 billion over the next five years to modernize its armed forces, including $11 billion on the fighter jets alone.

The show takes off against a backdrop of stepped-up arms spending and rapid growth in civil aviation in Asia's third-largest economy.

In recent months India has hosted U.S. President Barack Obama, Russian President Dmitry Medvedev and French President Nicolas Sarkozy, with defense and aviation deals among key agenda items.

India is looking to modernize its military in keeping with its growing global stature and in the face of increasing assertiveness by China in a South Asia region that New Delhi considers its sphere of influence.

Meanwhile, a burgeoning middle class in an economy growing at nearly 9 percent has spurred rapid growth in commercial aviation.

India has budgeted $32.5 billion for defense spending this fiscal year, up roughly four percent from a year earlier.

Commercial carriers are also expanding their fleets as demand booms. Indian budget carrier IndiGo in January placed a provisional $15.6 billion order to buy 180 planes from Airbus in the largest jet order in commercial aviation history.

Rival SpiceJet in November agreed to buy 30 Nextgen turboprop aircraft from Canada's Bombardier Inc for as much as $915 million.

However, infrastructure and financing challenges have hindered fleet expansion in India, even as passenger traffic grew 19 percent through November last year.

India has 400 commercial airplanes. By comparison, China has 2,600 planes. Indian domestic airlines carried roughly 46.8 million passengers through November last year, compared to 230 million in China a year earlier.

India's commercial fleet in service has trebled in the past 10 years to 322 airliners, according to Airbus, with another 280 planes waiting to be delivered. The backlog of undelivered planes has risen more than 20-fold in the past decade.

FIGHTER BATTLE

More than 600 manufacturers, vendors and suppliers from 63 countries will attend the show, including 35 companies from Russia alone, hoping to take advantage of the growth in India.

Cassidian, the recently renamed defense arm of EADS and a partner in the Eurofighter Typhoon, which is also vying for the Indian fighter award, plans to display the plane at the show.

Eurofighter is a four-nation consortium of EADS, representing Germany and Spain, Britain's BAE Systems and Italy's Finmeccanica .

Boeing's F/A-18 Super Hornet, Dassault's Rafale, Lockheed's F-16, Russia's MiG-35 and Saab's JAS-39 Gripen are also competing for the order and will be on display.

(Additional reporting by Tim Hepher in Paris; Writing by Jui Chakravorty; Editing by Tony Munroe)

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