The Indian Defense ministry said on Sunday that it will “negotiate” the price of 31 MQ-9B surveillance drones which New Delhi will acquire from American firm General Atomics (GA) once Washington grants a "policy approval" for the deal.
The US company has provided an estimate of just over $3 billion for the deal, New Delhi said.
“However, price will be negotiated once policy approval of the US Government is received. The Ministry of Defence (MoD) will compare the acquisition cost with the best price offered by General Atomics to other countries. The procurement is in progress and would be completed as per the laid down procedure,” the Indian defense ministry statement underlined.
Under the deal, New Delhi will procure the MQ-9B drones, which will be assembled in India.
“As part of this plan, General Atomics will also establish a Comprehensive Global MRO (Maintenance, Repair and Operations) facility in India to support India’s long-term goals to boost indigenous defense capabilities,” stated an India-US joint statement released after formal talks between Prime Minister Narendra Modi and President Joe Biden at the White House.
Outlining the procedure which it would follow for the acquisition, the Indian defense ministry said that a letter of request (LOR) with the “tri-services requirements, details of equipment and terms of the procurement” would be sent to the US government in coming days.
“Based on LOR, the US Government and MoD will finalise the Letter of Offer and Acceptance (LOA) where details of equipment and terms of the procurement would be negotiated and finalised in accordance with the FMS program and the price and terms offered by the US Government and GA to other countries,” said the Indian statement.
India’s Defense Acquistion Council (DAC), which is headed by Defense Minister Rajnath Singh, gave the Acceptance of Necessity (AoN) for the deal on 15 June, in the lead-up to Modi’s state visit to the US.
The final approval of the deal will be given by the Cabinet Committee on Security (CCS), which is chaired by Prime Minister Narendra Modi.
India Rejects ‘Speculative Reports’ on the Drone Deal
Meanwhile, the Indian defense ministry rejected “speculative reports” on price and other terms of the deal in the media.
“These reports are uncalled for, have ulterior motives and aimed at derailing the due acquisition process,” it said.
The defense ministry underlined that price and other terms of the agreement were yet to be finalized and “subject to negotiations”.