In September 2009, the Indian Finance Ministry had rejected the Indian Air Force/MoD selection of the A330 MRTT, calling it way too expensive. Reports at the time suggested that the final pricetag on the A330 MRTT package for six aircraft was Rs 8,000-crore ($1.8-billion), as against the IL-78M package that came with a pricetag of Rs 4,800-crore ($1.08-billion). The budget for the procurement was reportedly pegged at Rs 5,000-crore ($1.12-billion). The Finance Ministry wouldn’t hear of the anything over that figure.
Once Bitten, Airbus Stresses Economy In Indian Tanker Re-bid
Indian wire service PTI has a report today quoting Peter Scoffham, Vice President, Defence Capability Marketing for Airbus Military as saying, “We are offering the new A330 MRTT as it provides the best value for money.No other aircraft comes close to A330 MRTT as aircrafts designed in 1970’s cannot be compared with those being built now.”
In the re-tender, the budget for the procurement has been hiked to Rs 6,000-crore ($1.3-billion). The competition is likely to be fought between Airbus and the Boeing 767 tanker. Though the latter hasn’t officially committed to fielding its tanker in the competition, it is likely that it will. The IL-78M will compete, but the IAF doesn’t want it. Overwhelming serviceability and support problems continue to dog the IL-76 platform, a situation that was partly responsible for the IAF choosing not to exercise a follow-on order of six more IL-78Ms, and instead float a fresh tender in 2006.