MIG 29 “BAAZ”; In the Background is the Su-30 MKI.

February 2010 I A Commentary on Aircraft Upgrades

A look at the present Flight of Capability

Aircraft upgrade
programs. The Indian Air Force-IAF at present is grappling with a sharp decline in the number of
its fighter squadrons, which presently stand at a precarious number of 32. The
sanctioned strength of the IAF is 39.5 squadrons.

However the IAF is confident that operational procurement plans are in place to ensure
its capability to operate in India’s expanding strategic environment, stretching from the
Persian Gulf right up to the Malacca Strait.

The 4th largest air force in the world’s eventual aim is to transform into an
‘Expeditionary aerospace force’, with an innate capability of rapid deployment and
operations at a global scale.

This commentary provides a quick round-up of some of the major upgrade programs
underway.
IAF chief, Air Chief Marshal P.V. Naik,
has outlined a three-pronged strategy
for the Air Force. One, ‘to see first and
see the farthest’, with air-borne warning
and control systems (AWACS) and
satellites. Two, ‘to reach first and the
farthest’, with mid-air re-fullers to
enhance the radius of operations of its
fighters. And three, ‘to hit hard and
accurately’, with advanced missiles and
precision guided munitions. (PGM)
Program: MIG 29 “BAAZ” upgrade / Engine
• Proposal finalized – December ‘06, inked in
March 2008 with RSK-MiG
• Price:
o US$ 1,000 million for 62 units
o US$ 250 million for 120 engines
Background: In February ‘06, the Indian
government decided to upgrade its existing
fleet of MiG- 29S, MiG-29B and the twin seater
MiG-29UB. This upgrade would provide the
fighters with multi role capabilities and
improve their ability to carry advanced
weapons. The upgraded aircrafts would be
called MiG-29SMT / UBT fighters and their
flight-hour lifetimes would be extended from
25 years-2500hrs to 40 years-3500hrs. The
Russian company RSK-MiG already had a
dedicated upgrade kit for this program. It was
decided that the first 6 fighters would be
upgraded in Russia, while the rest would be
upgraded in India- at the base repair depot-
Nasik. The program was to be completed in 3
years from the date of the contract being
signed. (August 2008)
The upgraded fighters would be fitted with
extra fuel tanks in a thickened center spine.
Also included in the upgrade would be a new
avionics suite including the Phaztron Zhuk-ME
radar and in-flight refueling capacities.
Engine: The Indian govt. has also signed in
2006; contracts to license produce 120 units of
the the RD-33 series III jet engines, worth US$
250million. These engines would be an
improvement on the existing RD-33 series I and
II engines that are currently installed in the MiG
29 fleet.
Present Situation: The program is now slated
for completion only by 2014, almost 3 years
behind schedule.
The IAF was to provide RSK-MiG the associated
list of equipment and specifications. These
components would reportedly have come from
Indian, Russian, French and Israel (Elbit).
However, the IAF is yet to finalize this list and
provide it to RSK-MiG.
Program: Mirage 2000 upgrade
• RFP floated in April 2008, 2 years after
the program was finalized.
• Estimated cost of US$ 1,500 million for
51 units to be upgraded to the DASH-5
standard.
Background: Thales responded to the RFP in
July 2008. Under the proposed plan, the
company would deliver the first two aircraft
from in France within 40 months of the signing
of the contract, and would simultaneously
assist HAL in upgrading another two aircraft in
India. Thereafter, HAL would upgrade one of
the remaining 47 aircraft, every month. The
upgrade would extend the service life of the
aircraft by an estimated 20 years.
Under the upgrade, the entire frame would be
stripped down to be re-wired and re-equipped
with new avionics, mission computers, glass
cockpits, helmet-mounted displays, electronic
warfare suites and weapons systems. These
upgrades would enhance the fighters longer
range detection across the spectrum, its
tactical situation awareness, longer range
weapon firing capability against multiple
simultaneous targets and its weapon stealth
and extended operating envelope with the
capability to engage ground targets while
countering airborne threats. The new weapons
suite would include MBDA MICA, ASRAAM
missiles and other NATO standard air-to-
surface guided weapons.
Present Situation: During Prime Minister
Singh’s state visit to France in July 2009, the
two countries were slated to ink the US$ 2,100
million Mirage upgrade. However, the deal did
not go through. Initially, Thales had made an
offer of US$ 2,900 million for the upgrade; this
after protracted negotiations had been reduced
to US$ 2,100 million, which also the IAF found
exorbitant. The IAF claimed that instead of
spending US$ 41 million on each MIRAGE-2000,
it would prefer to buy brand new fighters. It is
worth noting that the original purchase cost of
the each MIRAGE-2000 was US$ 31 million.
The French urgency to get the deal signed
during President Sarkozy’s visit in early 2010,
has signaled Thales to source a significant share
of work and components from India. This will
help reduce their offer price. Indian avionics
manufacturers like Samtel-Thales Avionics, a
JV, will now manufacture certain upgrade
components locally. This will also assist Thales
in meeting its offset liabilities that will arise out
of the deal.
In the latest development (December ‘09),
Israel Aerospace Industries (IAI) has emerged
as a contender. The IAI proposal also includes
rewiring the aircraft to enable them to carry
the Rafael’s Derby BVR missile and Python-V
short range missile. The armament
compatibility extends further with the
incorporation of various Israeli sourced air-to-
surface guided weapons. This Israeli firm has
also opted to provide a fully operational
mission simulator to the IAF. According to a
source, the IAI offer is 40% cheaper than the
French proposal. Even though IAI is not the
OEM in this case, the company has significant
experience on similar aircrafts. IAI also
manufactures the KFIR, an aircraft similar to
the MIRAGE-III / IV.
Program: Aviant / Antonov An-32
• Antonov proposed the upgrade
program in 2005.
• Contract signed in June 2009 with
SpetsTechnoExport (STE) of UKRAINE.
• Price: US$ 400 million for 104 units.
Background: The IAF presently operates 105
An-32’s in the medium capacity transport
aircraft category. These aircraft were delivered
in 1984. The qualitative requirements as listed
by the IAF for the upgrade are- extending
service life, enhancing operational capabilities,
easing crew workloads and reducing
maintenance costs. Under the program, the
first 4 - 6 aircraft would be upgraded in Ukraine
and the rest at the base repair depot- Kanpur.
The upgrade would extend the service life of
the aircraft by up to 20 years.
The upgrade package will include work on the
An-32’s engines and avionics.
The aircraft’s AI-20DM engine’s time interval
between overhauls would be increased from
2000hrs to 4000hrs and the total power plant
life to 20,000hrs. The operating range would be
increased from 900km to 1,400km- by
integrating an additional fuel tank. The
maximum take-off weight would also be
increased by 1,500kgs to 28,500kgs.
The avionics of the An-32 will also be replaced.
According to sources, the IAI-ELTA developed
package, including a full glass cockpit with
standard MFD’s and a control unit is the front-
runner. This avionics package also includes a
digital moving map, full NVG capability, in flight
mission rehearsal options, HUD for both pilots.
The significantly new advanced EWS in the
package will feature a radar warning receiver,
the fourth generation EL/M-2160 missile
approach warning system, laser warning
receiver and conventional countermeasures.
Flight safety features being incorporated into
the upgrade will include an advanced terrain
avoidance warning system (TAWS) and an
enhanced traffic collision avoidance system.
(ETCAS)
Present situation: The upgrade program
commenced in Ukraine in December ‘09. and is
slated for completion by 2017. However the
Avionics package is yet to be firmed up.
Honeywell has also decided to participate in
the avionics upgrade as it has carried out a
similar upgrade on the An-32 of the Jordanian
air force.
Program: Jaguar upgrade / Engine
• Avionics suite upgrade of 69 aircrafts:
o From NAVWASS to DARIN II
o From DARIN to DARIN II
• Engine Upgrade of 128 aircrafts
• Estimated program cost:
o Avionics-US$ 123 million.
o Engine- US$ 670 million.
Background: The IAF received its first 38
Jaguars in a fly-away condition from BAe. These
aircrafts were fitted with the NAVWASS
(Navigation Attack Weapon Aiming Sub-
System) from Marconi-Elliot Avionics Ltd, with
the Head-Up display (HUD) from Smiths. At the
very outset, the RAF had clearly told the IAF
that this particular equipment had a very low
reliability factor. However, the NAVWASS was
the standard equipment onboard the Jaguar
aircraft and hence there was no easy
replacement. This made the IAF look at the
possibility of in-house development of an
inertial navigation system. (INS)
The project was managed by Inertial Nav-
Attack System Integration Organization (IIO)
that was specially set up under the DRDO. The
IIO, termed the indigenous INS as the DARIN-
Display Attack Ranging Inertial Navigation.
Sagem of France was appointed as the prime
integrator and the HAL as the prime agency for
carrying out the aircraft work. ASTE, Bangalore
also played a role in the selection of
equipment, its previous experience in this field
coming very handy.
DARIN was given full operational clearance in
1984, 9 years after the program began. Each of
the Jaguar’s built by HAL under license is
equipped with the DARIN avionics kit.
A newer version called DARIN-II is now being
fitted on all the Jaguars that were supplied by
BAe and the new ones being produced by HAL.
The DARIN-II has a HUD supplied by Elbit
(ISRAEL). An Elta (ISRAEL) built airborne self
protection jammer and an indigenous Rear
Warning Radar is also being installed. A Sagem
INS with Ring Guided laser (RGL) is further
enhanced with an embedded GPS; this
improves the accuracy to within 100m. To
improve redundancy, the Defence Avionics
Research Establishment (DARE) has supplied
twin mission computers.
The upgrade also includes a Litening Laser
Designator Pod, along with an Auto Pilot
supplied by SEXTANT- similar to the one
installed on the MIRAGE-2000. A new chaff
dispenser has also been added. On the 10
maritime Jaguars, the Agave radar is being
replaced with an Elta supply.
Present Situation: At present the DARWIN-II
upgrade is being carried out on the 17, twin
seater Jaguars being produced by HAL. Nine of
these aircrafts were inducted in July 2005.
Progressively, the BAe supply will be upgraded,
followed by the HAL built jaguars.
Background: DARE achieved the successful
completion of avionics upgrade of MiG-27
aircraft. This pioneering effort was realized
using entirely indigenous expertise at a fraction
of cost. The project was initiated in the year
2002 through a tripartite MoU between DARE,
HAL and the IAF. The Initial Operational
Clearance was accorded in June 2006 which led
to the subsequent formation of operational
squadrons. The upgrades were successfully
completed in January 2009.
Present Situation: The IAF, after being very
satisfied with the Avionics upgrade, has
decided to also re-engineer the Mig-27’s power
plants. According to sources, the Su-30’s power
plant, the Al-31 is being seriously considered.
Program: Mi-17 upgrade
• Cockpit & avionics upgrade of 160 units.
• Estimated cost: US$ 290 million

Engine: When the Jaguar is carrying its

Background: The twin-engine helicopters are
maximum permissible destructive and fuel
primarily used for troop insertion/extraction,
loads, the present Rolls-Royce / Turbomeca
casualty evacuation, logistic supply, search and
power plants licensed produced by HAL provide
rescue, reconnaissance and observation. They
a thrust/weight ratio of only 0.5. It is only the
operate in high altitude areas like the Siachen
skillful handling of the IAF pilots that the Jaguar
Glacier and have also been part of UN missions
can compete with the very best despite this
abroad.
underpowered engine.
It is anticipated that there would be a cockpit
As a major component of the upgrade, a
upgrade wherein, a state of the art LCD screen,
committee headed by K.V.L. Rao, an aero-
touch screen and other features would be
engine expert, has been tasked to recommend
installed in the cockpit, so as to reduce
an engine for the re-engineering of the Jaguar.
attention of the pilot from the cockpit. Other
The two contenders are Rolls-Royce’s ADOUR
features that the Mi-17 integrated helicopter
Mk821 and Honeywells’ F125IN. Both the
avionics system would have are instrument
engines were successfully tested for the IAF in
approach, night and day navigation in all kinds
Bangalore in June-July 2009.
of weather conditions, increased flight safety
A final decision is awaited. features, better communication equipment,
low-level flight safety due to terrain awareness
and warning system and night vision.
Program: MiG 27 Engine upgrade
Present Situation: The RFP is expected anytime
• Engine package for 40 units. now. Honeywell, Hindustan Aeronautics
• Estimated cost: US$ 134 million Limited (HAL), and ROSOBORONEXPORT are
the likely contenders expecting to recieve the
open RFP.
The 80 new Mi-17 helicopters, for which the
IAF order is with Kazan Helicopters; Kazan has
now approached Honeywell for the avionics.
Program: Sea King Mk42B & Ka-28PL Mid-Life
Upgrade (MLU)
• Structural and Avionics upgrades of Sea
King’s and Kamov’s.
• Estimated program cost:
o 18 Sea King’s- US$ 133 million.
o 28 Kamov’s – US$ 189 million.
The responses to the RFP’s have been received
by the MoD. The Technical Evaluation
Committee (TEC) is in the process of
scrutinizing them and a detailed evaluation will
follow. In the meantime it is understood that
the NCNC trials for the 2 platforms have been
completed. When the program was envisaged,
there were 18 Sea kings and 28 Ka-28’s. At this
point of time it is unclear if these numbers still
stand or have reduced further. A school of
thought is for the Indian navy to simply keep its
fleet airworthy and not carry out the proposed
MLU. A possible scenario could be that the
navy’s focus is now on the 37 new Multi-Role
Helicopters and the 5 new Kamov-31’s.
• SU-30MKI- upgrade program yet to be finalized.
• IL-76 & IL-78- upgrade program yet to be finalized.
• Mi-35- upgrade completed.
• Sea Harrier-upgrade completed.
• IL-38- upgrade completed.
DISCLAIMER: This note has been prepared by Religare Capital
Markets (“RCML”) on the basis of publicly available information,
information provided by the company and promoters, neither
which have been independently verified by RCML. RCML or its
employees shall in no circumstances whatsoever be liable or
responsible for any inaccuracies, omissions, mistakes or errors in
this paper and for any economic or any other loss or damage,
incurred or suffered by the reader/ user or any other person,
arising (whether directly or indirectly) out of or in connection
with such information. This note has been prepared without
prejudice. Any and all information contained herein is based on
good faith assumptions and is provided for general information
purposes only. This information does not constitute an offer,
promise, warranty, or guarantee of performance. This document
should not be used or relied upon for any purpose other than as
intended by Religare Capital Markets Limited. Opinions expressed
herein are subject to change without notice. RCML undertakes no
obligation to provide the recipient with access to any further
information or to correct any inaccuracies or omissions which
may become apparent. (Assumption: 1USD = Rs.45)
RELIGARE STRATEGIC ADVISORY is the arm of
Religare addressing the segments of Aerospace;
Defence; Nuclear and Homeland Security providing
Advisory Services, Project Management, Investment
Related services and Supply Chain Management
Col. K.V. Kuber
Sr. Vice President - Investment Banking
M: 9650498286, E: col.kuber@religare.in
Rahul Gangal
Sr. Vice President - Defence Advisory Services
M: 9650690869, E: Rahul.gangal@religare.in
Ankur Gupta
Sr. Manager- Defence Advisory Services
M: 9560297134, E: ankur.gupta1@religare.in
Corporate office: D3, District Centre Saket, New
Delhi- 110017, India.
T: +91(11) 3912 5000 F: +91(11) 3912 5051 / 52
www.religare.in