India cancels tanker transport tender

India's Ministry of Defence (MoD) has summarily cancelled the INR48 billion (USD1.06 billion) tender for six multirole tanker transports (MRTTs) for the Indian Air Force (IAF), for which the EADS-built Airbus Military A330 MRTT was the preferred choice.

In 2008 the IAF had recommended the A330 MRTT over the rival Russian Ilyushin Il-78, of which it acquired six in 2004 for INR8 billion.

However, ignoring its evaluation following years of extended trials, the MoD dispatched a cryptic letter to EADS in New Delhi on 4 January withdrawing the tender, which IAF sources indicated was on the 'verge' of closure.

MoD sources said the MRTT requirement would now be retendered, resulting in interminable delays.

"It will now take many more years to shortlist another MRTT unless the MoD insists we acquire the Il-78s against our better judgement," an IAF officer said, declining to be identified.

The terminated tender required Airbus to deliver the first A330 MRTT to the IAF within three years of signing the deal and the remaining five within 15 months thereafter.

EADS officials in Delhi declined to comment on the tender's withdrawal, but defence industry sources said "vested interests" had influenced the federal Cabinet meeting on 29 December 2009 that decided to cancel the acquisition of the badly needed MRTTs.

Military sources said that, despite entreaties not to do so by the IAF, Defence Minister A K Antony agreed to cancel the MRTT purchase after the federal finance ministry raised objections on grounds of the A330's high cost.