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Saab's Gripen in talks with India defense companies on systems

Saab AB, the Swedish maker of the Gripen fighter jet, is in talks with Indian defense companies to build systems, as it prepares to bid for a $9 billion fighter-jet order by the country's air force.

„We are talking to Indian defense and aerospace companies for manufacturing of avionics, propulsion and software,” Tony Ogilvy, Gripen International director for India, said in an interview today. „The talks are at a very advanced stage.” Saab, Boeing Co. and Lockheed Martin Corp. are trying to increase their investments in India's defense companies as they plan to compete for the 126 combat jets -- the largest such contest in 15 years, according to Boeing. Saab is marketing the Gripen as a low-cost and reliable solution to the Indian air force. To win the award, Saab will have to beat offerings from both Boeing and Lockheed Martin, as well as Russia's MiG Corp. and France's Dassault Aviation SA.

„Gripen will cost the Indian government very significantly less than its nearest single engine competitor and a fraction of its twin-engine competitors,” Ogilvy said at the Aero India show in Bangalore. He declined to elaborate. The Indian air force wants to buy the multi-role combat jets to replace aging Russian-made aircraft. Preparation for the bids is in the final stages and will be called soon, A.K. Antony, India's defense minister said on February 7. Saab said in September it will enter into a 350 million-rand ($49 million) venture to make airplane parts with South Africa's state-owned Denel Ltd. Saab will own 20% of the venture, which will be established in South Africa, with Denel owning the rest, according to Kenth-Aake Joensson, Saab's executive vice president.

Saab, which is supplying the single-engine Gripens to South Africa's air force, agreed to invest and create jobs in Africa's largest economy in exchange for being awarded the contracts. Apart from the multi-role fighter jet contract, Saab wants to explore business opportunities to „maximize our engagement with India in land, sea and air business units,” Ogilvy said. „This jet contract is the start of a much larger involvement of Saab in India,” he said. Boeing Co., the second-biggest US military contractor after Lockheed Martin, today said it will bid to sell helicopters to the Indian government for the first time, attempting to break into a market dominated by Russia's state-owned OAO OPK Oboronprom. Political relations between the US and India are improving. Last year the US lifted a ban on nuclear exports to India, which had led the South Asian country to mostly buy planes from Russia. (Bloomberg)