U.K. considering ‘price cut’ to win Indian defence deal

February 08, 2012 07:12 pm | Updated November 17, 2021 02:52 am IST - LONDON:

British manufacturers of Eurofighter Typhoon jets are reported to be willing to lower their bid to win back the multi-billion dollar Indian contract they controversially lost to their French rivals Dassault last week.

Ian King, chief executive of BAE Systems, said on Tuesday that he would be discussing the issue with other members the BAE-led European consortium involved in the bid and the option of a price cut was very much “on the table’’.

“I will be discussing with our partners what to do next. In my view all options are on the table,’’ he told The Financial Times and “confirmed’’ that price reduction was being considered.

The move came as India’s choice of Dassault’s Rafale as the preferred bidder over BAE’s Typhoon caused fury in Britain with Prime Minister David Cameron calling it a “disappointing’’ decision, and MPs demanding an end to British aid to India in retaliation.

Mr. Cameron promised in Parliament that he would do “everything I can’’ to persuade India to review the decision. "Of course, I will do everything I can – as I have already – to encourage the Indians to look at Typhoon, because I think it is such a good aircraft," he said as MPs described the Indian move as a “snub’’ and a failure of British diplomacy.

Industry experts were reported as saying that they were surprised by India’s decision as they had been confident that Typhoon would “edge out’’ the Rafale which, they claimed, had not got any export orders and faced “a potential production shutdown’’.

Rafale, they said, appeared to have won because of the lower French bid and “plus any other sweeteners such as more generous technology transferred agreements” offered by Paris.

The FT quoted an analyst at the Royal United Services Institute as saying that the British bid was “too technical and lacked the grand military vision of that of the French’’.

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