The partnership will compete with US defence giant Lockheed Martin in a two horse-race to win a potential order from India's military for single-engine jets that will be produced locally under Prime Minister Narendra Modi's "Make-in-India" initiative.
The Saab-Adani partnership is aimed at producing planes under India's new "strategic partnership" policy, Ratan Shrivastava, an independent New-Delhi-based consultant and adviser at India's industry lobby group FICCI has said.
Under the defence partnership policy, a foreign aircraft maker will collaborate with an Indian firm to develop a world-class indigenous aeronautical base that India has struggled to build for decades. Lockheed has already picked India's Tata Advanced Systems as its local partner to produce its F-16 fighter planes that will compete with Saab's Gripen aircraft.
The Indian Air Force needs hundreds of aircraft to replace its Soviet-era fleet; PM Modi wants the planes built in India to help boost the domestic industrial base and cut imports.
Adani is a $12 billion group with businesses ranging from energy and logistics to real estate and defence.
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