"With the road map now in place, the production of Kamov 226T helicopters has formally taken off," said a top executive of the state enterprise Hindustan Aeronautics Limited, which was the production agency nominated by the two nations.
Gopal Sutar, the chief of media communications at HAL, said: "The helicopters are to be produced through a joint venture company as per the intergovernment agreement between the two countries in October 2016, and the road map for the acquisition is finalized."
The joint production of the helicopters in India now awaits formal approval by Russian President Vladimir Putin, which will lead to the new production entity Indo-Russian Helicopters Private Limited.
Russian government-owned Rostec Corp. will own a 49.5 percent stake in the new entity, and India's HAL will own the remaining 50.5 percent. Thereafter, the Indian Ministry of Defence will issue a single-vendor tender to Indo-Russian Helicopters Private Limited, which will then submit its technical and commercial proposal within six months.
While some analysts say the price of the helicopter remains an concern, the top HAL executive said the issue will be sorted out in the technical and commercial proposal.
Bharat Kumar, a defense analyst and retired Indian Air Force air marshal, said the intergovernmental agreement would have already provided a time frame for the delivery of 40 helicopters by Russia and the supply of kits, subassemblies and so on. "I am more than sure that the agreement would also have indicated the price and other financial details, including share holdings in the joint venture," he added.
Under the $1 billion deal for 200 Kamov Ka-226Ts, India will buy 60 helicopters in fly-away condition from Russia while another 40 will be assembled in India and the remaining 100 fully built in India.
The manufacturing will take place at a new complex in Tumkur near HAL's Bangalore helicopter complex.
"Apart from production, the plan also includes setting up repair and maintenance facilities to provide faster support to the armed forces," the HAL executive said.
However, the overall composition of the Ka-226T helicopter in regard to components and systems remains a concern, according to Baldev Singh Pawar, a retired Indian Army lieutenant general and former director general of Army aviation.
Pawar said the engine and some "key systems and avionics have been sourced by the Russian company from the global market," adding that Russia continues to be under U.S. sanctions.
An Indian MoD official insisted "all the obstacles will be cleared," but did not provide details
India needs a light utility helicopter to replace its aging Cheetah and Chetak helicopters produced under license from France.
"The Cheetah and Chetak continue to be reliable and heavily used helicopters despite their age. The imperative to procure a replacement has as much to do with the growing requirement for light helicopters as creeping obsolescence of the existing light helicopter fleet," offered Vijainder K Thakur, a defense analyst and retired Indian Air Force squadron leader.
Although the Ka-226T program is making progress, the MoD has not quashed its requests for information that it floated separately in 2014 for the joint development of light utility helicopters for the Indian Navy and Air Force; and in this India may keep its options open for the procurement of light utility helos from other sources.