US Congress notified of potential C-17 sale to India

Washington DC
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The US arms export agency has notified Congress that India could buy 10 Boeing C-17s in a deal valued at $5.8 billion.

The notice by the Defense Security Cooperation Agency (DSCA) is mandatory before the US can finalise a contract with the Indian government. However, it stops short of making a binding commitment to complete the transaction.

The $5.8 billion means the average cost per aircraft is nearly $600 million. But the value is a ceiling that includes the cost of the aircraft, spares, training, support and the fee DSCA charges to broker the deal.

If the contract is signed, India would become the single-largest of six international militaries to already buy the C-17. The UK, Australia, Canada, Qatar, the United Arab Emirates and the North Atlantic Treaty Organization have combined to buy 25 C-17s so far.

The deal also would help Boeing's four-year campaign to extend C-17 production through foreign sales and enlisting Congressional supporters to add unrequested aircraft to the US Air Force budget.

The USAF has purchased 223 C-17s in total, although it requested funding for only 180. The last 43 C-17s have been added to the budget by Congress. USAF officials have said that further C-17 purchases can only occur if the service is allowed to retire Lockheed Martin C-5As.

The Boeing production line is scheduled to shut down before 2013 in the absence of new contracts.