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June 13, 2024
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As Dassault is discovering, doing business in India is very tough. The company was thrilled to win an order for 126 Rafales in 2012 after a long drawn out competition. Here we are in 2016, and not one aircraft has been delivered and India is still negotiating. The order is now down to 36. It’s amazing the French are still even speaking to the Indians.

India has also driven Russian partners up the wall. Here is the latest example.

India and Russia were going to develop a military transport aircraft (MTA) together.   But, as usual, India has not met its side of the deal. The MTA is to be based on the Russian IL-214. The idea for this aircraft dates back to 2010. Interestingly the IL-214 was first conceived as a four engine turboprop in 2001! As one can see doing business in India requires extraordinary stamina and patience. That the Russians are also still talking about this aircraft with India is also amazing.

What if the Indians move on from the MTA idea to something that is real and currently exists? Specifically, Embraer’s KC-390.   Embraer is likely to want some program support because the Brazilian state cannot afford the aircraft anymore. Let’s compare the specifications of the two aircraft.

22The KC-390 is a lot more expensive. But it does offer more payload capabilities than the IL-214. Take a look at these two aircraft and you might notice they look very similar too.


Perhaps India can contact Embraer to see what opportunities there are to collaborate? Embraer might find a deal attractive, provided India delivers its side of any deal in short order. Of course that is a long shot.  At least the Indians can see what their airplane will look like and even undertake test flights.

There is a lot of hype about the BRICS nations (Brazil, Russia, India, China and South Africa), but the reality is that grouping is a myth, a verbal convenience to describe a set of developing nations which often compete with each other and seldom cooperate. Could one BRICS member back off on a deal with another member?  It certainly looks possible, and in the case of India, rather likely.

If you are selling aircraft in India, whose government on the commercial side has previously impeded the Cape Town Convention on asset repossession, caveat emptor.  Make certain of payments in advance.

1 thought on “The Difficulty of Doing Business in India

  1. I don’t know what the sources are for pricing, but the cost differences are almost certainly pure fiction. I’d expect either Brazil or Russia to be able to beat the costs of the US or Europe by a decent margin, but not by half even for that comparison, much less compared to each other.

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