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01:00 PM, July 25, 2016
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Japanese Shinmaywa US-2i amphibious aircraft

Indian Navy will acquire 12 Japanese Shinmaywa’s long-range amphibious aircraft US-2i for an approximate $1.65 billion under the government-to-government deal.

The US-2i aircraft will be procured under the ‘buy global’ clause of the Defence Procurement Procedure, government sources were quoted as saying by Financial Express Saturday.

The deal, which is going to be government-to-government, was changed from ‘buy and make global’ to ‘buy global’ after amendments were made to two chapters of the DPP, and subsequent rounds of discussions with the industry association.

The deal found mention in the recent interaction between the two nations’ defense ministers in New Delhi earlier this month. The Defense Minister of Japan Gen Nakatani was paying a bilateral visit to India at the invitation of Indian Defense Minister Manohar Parrikar. The two ministers held the annual Defense Ministerial Meeting on 14 July 2016 in New Delhi.

A senior officer was quoted by FE as saying that, “The plan to Buy Global will be sent to the Defence Acquisition Committee in a couple of months before any formal decision is made. Also, there will be a 30% offset clause that the Japanese side will be signing. ”

A source in the Japanese company told defenseworld.net last week that, “The case is still to go to Services Capital Acquisition Requirement Categorization Board (SCAP) and later to Cabinet Committee for Security and is likely that the SCAP will be appointed in August.”

The deal, which has an approval of the Department of Industrial Policy and Promotion, is waiting for an acceptance of necessity (AON) from the Indian Navy.

While the army, navy and the coast guard are supporting the requirement of these planes, “It will be like an AON that the navy requires 12 US-2i as of now, and the commercial negotiations for them can begin. The coast guard, in turn, may require five such planes,” explained a defence ministry source.

The Indian Navy had issued a request for information (RFI) for the aircraft. Canada’s Bombardier, Japan’s ShinMaywa and Russia’s Beriev had offered their aircraft to meet the requirements.

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