An Indian facility that makes Su-30MKI jets may shut down, toppling 400 local suppliers

An Indian facility that manufactures Sukhoi Su-30MKI fighters may close in March 2020, leading to a domino effect that could see 400 local suppliers shut their shops over a lack of component orders, according to company officials and industry analysts.

A senior executive of India’s state-owned Hindustan Aeronautics Limited said the company, which owns the facility, will complete the production of the remaining eight Su-30MKI fighters on order by March. Then the production facility at Nasik, central India, could shut down if no new orders are placed, the executive warned.

An executive with the industry lobby group Federation of Indian Chambers of Commerce & Industry, said 400 local suppliers that build about 6,000 components worth $12.5 million for each Su-30MKI fighter may also shut down if no new orders are placed with HAL.

HAL produces about 12 Su-30MKI multirole fighters each year. The company is expected to complete the delivery of 272 Su-30MKI fighters by March 2020.

Each Su-30MKI is built by HAL for $70.3 million under license by Russia’s United Aircraft Corporation.

Another HAL executive said a formal request has been sent to the Indian Air Force and the Ministry for Defence that they place an additional order for 72 locally made Su-30MKI fighters for about $5 billion, but the government has not yet made a decision.

A senior Air Force official said the service could only order 18 fighters as a response to the number of Su-30MKI jets lost in accidents over the last two decades.

The Air Force is not eager to place large orders of these fighters because of the cost of locally made Su-30MKI jets.

“Each HAL-built Su-30MKI fighter costs around $70.3 million, where as a Russia-supplied fighter costs around $42.15 million,” the senior Air Force official said.

A senior MoD official said that Russia last month tried to pressure the Indian government to order an additional 72 Su-30MKI fighters with HAL, but the Indian Air Force is reluctant to place new orders in such a large number.

“The HAL built Su-30MKI fighter is not fully indigenized, only 51 percent is homemade, where the remaining 49 percent of supplies still comes from Russia,” said Bhim Sigh, a retired wing commander with the Indian Air Force.

Singh noted that most of the raw materials are sourced from Russia, including titanium blocks, forgings, aluminium and steel plates, as well as low-tech items such as nuts, bolts and screws.

HAL continues to depend on Russia as the original equipment manufacturer for components, raw material, servicing and overhaul of the fighters.

  Vivek Raghuvanshi - defencenews