In the biggest-ever deal for a public sector defence undertaking, Hindustan Aeronautics Limited has signed a $1-billion dollar manufacturing outsourcing contract with American aerospace major Boeing over 10 years.
Under a memorandum of understanding signed in New Delhi by Jim Albaugh, President of Boeing Integrated Defence System and HAL Chairman Ashok K Baweja, the Indian defence PSU, will manufacture subsystems for Boeing's wide range of fighter planes like F-15, F-18 Super Hornetts and Apace Helicpoters.
The American company, which is vying for India's major defence contracts for purchase of 126 multi-role combat aircraft, eight long-range maritime reconnisance planes made it clear that the outsourcing was "without any strings".
Albaugh, however, said Boeing was seeking clearance by the Indian government if it could use part of the staggering amount as credit against any future offsets if it secures any major contract.
"Effective today, an initial tranche of $20 million worth of work is being transferred immediately," the Boeing CEO said.
He said the company would in weeks to come be sending material and personnel to set up the