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Originally published Thursday, April 28, 2011 at 7:07 AM

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Boeing, Lockheed Martin out of Indian defense deal

The two American fighter aircraft makers are out of the running for a slice of the $11 billion Indian deal for 126 fighter jets.

The Associated Press

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NEW DELHI — Two American fighter aircraft makers are out of the running for a multibillion-dollar contract for the Indian air force, the U.S. ambassador said Thursday.

Boeing and Lockheed Martin were both bidding for a slice of the $11 billion Indian deal for 126 fighter jets.

"The U.S. Embassy in New Delhi was informed yesterday that two aircraft offered by the U.S. Government through the Foreign Military Sales process were not selected for procurement by the Indian Ministry of Defense," Ambassador Timothy J. Roemer said in a statement.

It added that the U.S. was deeply disappointed but respected the procurement process.

Indian news reports say two of six contenders are still being considered: German consortium Eurofighter Typhoon and the French company Dassault Aviation. Russian Mikoyan-Gurevich and SAAB of Sweden also are out of the running.

Indian officials were not immediately available for comment.

"I am extremely confident that the Boeing F/A 18IN and Lockheed-Martin F-16IN would provide the Indian air force an unbeatable platform with proven technologies at a competitive price," Roemer said.

India is expected to spend $80 billion over the next decade to upgrade its military.

Over the last few years, India has become the world's top arms and defense equipment buyer amid its rising concerns about China's regional power and a traditional rivalry with neighboring Pakistan.

India is expected to sign the aircraft deal within a year's time, said Rahul Bedi, a New Delhi-based analyst for the independent Jane's Information Group.

"The tender is for 126 aircraft. The procurement is eventually likely to go up to 200 aircraft" for an estimated $14 billion to $16 billion, Bedi said.

According to the terms of the tender, 18 selected aircraft are to be bought outright, and the remaining 108 made under license by state-owned Hindustan Aeronautical in the southern Indian city of Bangalore through a transfer of technology, Bedi said.

India's air force flies 1,500 aircraft of numerous types and national origins. The primary fighter aircraft are vintage Russian-made MiGs.

About 70 percent of India's military hardware is of Soviet origin.

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