IAF Proposes ₹2 Lakh Crore Rafale Jet Deal

India’s defence capabilities are set for a significant upgrade with the Indian Air Force (IAF) proposing the acquisition of 114 Rafale fighter jets under a ₹2 lakh crore ‘Made in India’ plan. If approved, this would be among the largest defence procurement deals in Indian history, aimed at expanding IAF’s air superiority while boosting indigenous manufacturing.

This move aligns with the government’s push for Atmanirbhar Bharat (self-reliant India) in defence, with over 60% of the jet’s components to be manufactured domestically in partnership with Dassault Aviation and Indian firms such as Tata Group.

Procurement Process: Where the Deal Stands

The IAF has already submitted a Statement of Case, which is now under review by various departments within the Ministry of Defence, including Defence Finance.

Steps Ahead,

• Internal review within the ministry
• Examination by the Defence Procurement Board, led by the Defence Secretary
• Final decision by the Defence Acquisition Council
• Only after these stages can the formal tendering and contract negotiations begin.

Expansion of India’s Rafale Fleet

• India currently operates 36 Rafale jets procured under a 2016 deal with France. Additionally, the Indian Navy has placed an order for 26 Rafale Marine jets, intended for carrier operations.
• If the new proposal is cleared, India’s total Rafale fleet would rise to 176 aircraft, making it one of the largest Rafale operators outside France.
• This would provide a massive boost to IAF’s combat readiness, especially amid regional tensions and the need for advanced multi-role fighters capable of long-range precision strikes.

Indigenous Manufacturing & Industrial Benefits

A standout feature of the deal is its focus on local production,

• Over 60% of the aircraft’s content is expected to be sourced or built in India.
• Dassault Aviation has proposed setting up a Maintenance, Repair, and Overhaul (MRO) hub in Hyderabad, specifically for the Rafale’s M-88 engines.
• Dassault already operates support and servicing units for French-origin aircraft in India.
• Tata Group is anticipated to be a key domestic partner, potentially leading assembly and sub-system manufacturing.

This deal would generate high-skilled jobs, enhance defence R&D, and build long-term manufacturing capabilities in aerospace.

Key Takeaways

• Proposal: 114 Made-in-India Rafale jets
• Estimated Cost: ₹2 lakh crore
• IAF Fleet Post-Approval: 176 Rafales (36 existing + 114 proposed + 26 Navy)