India is on the brink of finalizing its biggest-ever defence deal, with the Air Force’s proposal to procure 114 ‘Made in India’ Rafale jets advancing through government review. The prospective agreement, valued at over ₹2 lakh crore, aims to significantly boost domestic aerospace capability, technological self-reliance, and the nation’s overall combat power [September 2025 updates] [web:3][web:2][web:4][web:5][web:12].

114 Rafale Jets Deal: An Overview

The Indian Air Force’s (IAF) plan involves acquiring 114 advanced fighter aircraft built by Dassault Aviation—in partnership with Indian aerospace firms—under the ‘Make in India’ initiative. The jets are expected to have more than 60% indigenous content, with production, assembly, and major maintenance activities centered in India.

• Deal Value: Over ₹2 lakh crore (approx $23.8B)
• Significance: Largest-ever Indian defence contract
• Indigenous Content: 60%+ targeted
• Manufacturing Collaboration: Dassault Aviation + Indian industry (likely Tata et al.)
• Approval Pipeline: Defence Procurement Board → Defence Acquisition Council → Final Cabinet clearance

What Makes Rafale Jets Special?

The Rafale, a 4.5-generation twin-engine multi-role fighter, has already earned its stripes with the IAF—notably outclassing advanced adversaries during recent military operations. With cutting-edge Spectra electronic warfare suites, superior agility, and diversified weapon compatibility, the Rafale has proven its value in both air superiority and deep strike missions [web:3][web:4][web:8][web:12].

• Combat Record: Key role in Operation Sindoor, outclassed competing Chinese PL-15-equipped jets
• Weapons: Will feature longer-range air-to-ground missiles than those used in past Pakistan strikes
• Fleet Expansion: Proposal will raise India’s Rafale inventory from 36 to 176 jets (including Navy orders)

“If approved, this will not only set new records for deal size, but also elevate India as a serious aerospace manufacturing and design nation.” [web:3][web:2][web:8]

Why Now? Strategic Timing and Security Imperatives

With evolving regional threats, especially along northern and western frontiers, the IAF has identified an urgent need to replenish and modernize its fleet. The Rafale buy is planned as a backbone to supplement the Su-30 MKI, bolster force numbers amidst old aircraft retirements, and prepare for unpredictable multi-front challenges [web:4][web:5][web:8].

• China-Pakistan Axis: Rise in hostile activity, need for deterrence
• Older Fleet Phasing Out: MiG-21s, Jaguars slated for retirement within 3–5 years
• Future Readiness: Synergy with LCA Mark 1A, and upcoming fifth-gen projects

Make in India: Industrial Growth and Job Creation

The heart of the proposal lies in the unprecedented local manufacturing mandate, with over 60% of value addition to be done on Indian soil. Key elements of the ecosystem include:

• Production Partnerships: Dassault with Tata Advanced Systems and others
• Engine MRO Hub: Safran Aircraft Engine Services to establish a major MRO facility in Hyderabad for Rafale’s M-88 engines, promising about 900 new jobs over time [web:2][web:12]
• Technology Transfer: Rich transfer of next-gen avionics, manufacturing, and maintenance know-how
• SME and Start-Up Boost: Large-scale vendor, supply-chain, and skill upgradation opportunities for Indian MSMEs

Industry experts predict a ripple effect, energizing the entire aerospace and defence sector, with long-term prospects for design, research, and even export elevation [web:3][web:2][web:4].

How Will the Acquisition Process Work?

The Statement of Case filed by the IAF is under consideration. The progressive stages include:

1. Internal review by Defence Ministry’s different wings
2. Clearance by Defence Procurement Board (DPB)
3. Defence Acquisition Council heads final project assessment
4. Cabinet Committee on Security, led by the Prime Minister, grants final approval
5. Downstream negotiations with vendors (Dassault, Indian partners), financing, and eventual signing

If fast-tracked, officials estimate the agreement could be inked within 12–18 months, with first jets rolling off Indian lines by the 4th year.

Impact on Defence & Aerospace Stocks

News of the Rafale proposal has already charged India’s defence stocks—companies such as Hindustan Aeronautics Limited (HAL), Astra Microwave Products, and Bharat Electronics Limited (BEL) saw a rally on the bourses shortly after the IAF’s intentions were revealed. Investors anticipate robust order books, technology partnerships, and sustained international interest [web:3].

Risks, Concerns & Criticisms

• High Per-Unit Cost: At $200M+ per jet (with localization, infrastructure, offsets), the deal is costlier than peers [web:10]
• Sustainability of Indian Production: Ensuring long-term capability, beyond just assembly, for advanced fighters
• Procurement Transparency: Opaque aspects and need for robust oversight

Nonetheless, strong checks are in place—multi-stage vetting, competitive benchmarking, and offset monitoring promises a buy that serves both urgent security and future industrial objectives.

What’s Next for Indian Air Power?

If successfully executed, this Rafale contract will give the IAF the edge it seeks in Asia. Rapid induction of 114 units, coupled with growing indigenous LCA fleets and plans for indigenous 5th-gen fighters, means India will have a modern, flexible, and formidable flying force. Experts claim this could boost India’s deterrence profile vis-à-vis China and Pakistan for years to come [web:2][web:3][web:4][web:12].

Final Thoughts: A National Turning Point

This mega Rafale acquisition is more than a contract—it’s a statement of intent. With stakes spanning security, technology, jobs, and global standing, successful execution will anchor India among the few nations with end-to-end advanced combat aircraft production capability and a cutting-edge air force. Watch this space—the future of Indian defence and aerospace is being written here.