£700m training jets deal a boost for BAE and Rolls Royce

Published on 28/07/2010 15:46

A MULTI-MILLION pound agreement to provide 57 advanced trainer jets to the Indian military was signed yesterday, the first in a series of trade agreements expected to emerge from the UK government's trade delegation visit to the sub-continent.

The Hawk planes, which will be manufactured in India by Hindustan Aeronautics under licence from BAE Systems, will be powered by Rolls-Royce Adour engines and represent the second batch of aircraft bought from the UK by India following an order for 64 jets placed in 2004 after 18 years of negotiations.

The latest order, which is worth 500 million to BAE systems and up to 200m for Rolls-Royce, represents a boost for British defence firms looking to break into the huge Indian defence market dominated by Russian, US and Israeli companies. New Delhi plans to spend 64 billion over the next decade to upgrade its Soviet-era defence system.

Under the deal, BAE, the biggest defence contractor in Europe, will supply 40 trainer jets to the Indian Air Force and the remainder to the country's navy. The jet trainers will help Indian pilots fly new generation fighter jets.

Prime Minister David Cameron said: "This is an outstanding example of India-UK defence and industrial partnership, and this agreement will bring significant economic benefits to both our countries. It is evidence of our new, commercial foreign policy in action."

Guy Griffiths, the group managing director international at BAE Systems said: "This new order continues and strengthens the long-standing relationship between BAE Systems and HAL. It highlights the importance of BAE Systems' strategic development of India as a home market, and the benefit of solid government support."

Chris Awde, Rolls-Royce defence sales and commercial director said: "India is strategically important to Rolls-Royce and we will continue to look at new programmes that expand our partnership in the future."

But a spokesman for the Campaign Against Arms Trade criticised the deal: "The Hawk deal will not benefit the people of India who need food security rather than vastly expensive weapons."