India, Japan To Finalize $1.3B Amphibious Aircraft Deal During Shinzo Abe’s Visit

India is likely to buy 12 ShinMaywa’s US-2i amphibious aircraft from Japan in a $1.3 billion during Prime Minister Shinzo Abe’s visit to India later this week.

The deal seems to have got finalized during a meeting between former Indian Defense Minister Arun Jaitley and Japanese counterpart Itsunori Onodera in September last year in Tokyo, BusinessLine reported quoting unnamed sources as saying.

Japan might be offering 10-15 per cent discount on each of the plane that costs over $100 million, sources said.

As of now the focus for India will be to procure 12 planes in off-the-shelf deal. Building the plane (in India) will be next phase of the deal, the news daily quoted an official involved in the deal as saying Tuesday.

“This is because having a platform is an absolute necessity for the Navy. And there are few suppliers for this kind of an aircraft. This will be a great asset in protecting our interest in the IOR,” the official said.

Japan's ShinMaywa is looking at manufacture of parts and their assembly besides part -manufacture of the full flight simulator of its US-2i amphibious aircraft in India.

A source close to the deal told defenseworld.net on Thursday that that the company would also look at maintenance, repair and overhaul (MRO) of the aircraft in India.

"We have done an extensive study in these areas and are now pretty sure, about the capability that exists and that could possibly be transferred," he said while denying media reports that there were plans to manufacture the aircraft in India under the 'Make in India' program.

He said third party sale does not come into picture, if the numbers don't match the manufacturing requirement. "However, our aim is to ensure maximum possible development of the aeronautical industry manufacturing base in India. That is what we had planned from the beginning. In our own limited way we would explore the maximum spectrum of aeronautic industry to create cooperation wherever possible".

Indian Prime Minister Narendra Modi announced in mid-2014 his wish to buy US-2 amphibious aircraft for the Indian Navy. However, negotiations suffered as the Japan refused to lower the quoted price of $133 million per aircraft.

Negotiations were revived in September last year, as various media outlets reported that Japan was considering reducing the price as much as possible for the aircraft deal with India.