In a historic decision taken by the Defense Acquisition Council, Tata Advanced Systems Ltd. (TASL) will partner with Airbus in a $2 billion deal to manufacture the C-295 transport aircraft that will replace the aging Avro transport planes. This decision is expected to pave the way for the establishment of an aerospace infrastructure in the private sector.

“Airbus had bid jointly  with TASL for the Avro transport aircraft replacement tender with the hope that they [Airbus and TASL] will together draw major plans to join hands in the aero market, including joint production of a variety of helicopters,” an executive of the Tata group said.

The council also approved the purchase of 145 M777 ultralight howitzers from the U.S. subsidiary of BAE Systems on a government-to-government basis, along with a proposal for Hindustan Aeronautics Limited to jointly produce Ka-226T helicopters with Russia. The Ka-226T twin-engine helicopters will replace India’s Cheetah and Chetak helicopters.

Defense News mentions that the proposals cleared by Defense Acquisition Council just need to be  approved by the Cabinet Committee on Security headed by the prime minister. The India Expert does not expect any problem with such approvals.