Amid tariff dispute with Trump, India set to sign Rs 83000000000 deal with US on…, agreement to be finalised by…

This comes at a time when India’s relations with China are tense and the situation has become more complicated after former US President Donald Trump imposed a 50% tariff on India over its trade ties with Russia.

Written by: Analiza Pathak Edited by: Analiza Pathak
Updated: August 27, 2025, 6:55 AM IST

India is close to finalizing a USD 1 billion (roughly around Rs. 8,300 crore) agreement with US company GE to buy 113 more GE-404 engines for the Light Combat Aircraft (LCA) Tejas. According to reports by ANI, quoting defence sources, the discussions are almost complete, and the deal is expected to be signed by September. Under this agreement, GE will supply around two engines every month to meet its commitment to the Indian LCA programme.

This will be the second major deal with the US company after the tariff dispute with Donald Trump’s presidency. The first was a Rs. 62,000 crore deal to buy 97 additional LCA Mark 1A fighter jets.

State-run Hindustan Aeronautics Limited (HAL) had earlier signed a contract for 99 GE-404 engines to power the first batch of 83 LCA Mark 1A aircraft. This new agreement will add 113 more engines to support the production of the 97 additional jets ordered by the Indian Air Force.

Defence officials said the final round of talks is almost done, and the agreement should be signed by September this year.

The deal will help HAL move closer to its goal of securing a total of 212 GE-404 engines without facing supply delays.

In addition to this, India will also need about 200 GE-414 engines for the upcoming LCA Mark 2 and the Advanced Medium Combat Aircraft (AMCA) projects.

HAL plans to deliver the first batch of 83 LCA Mark 1A jets by 2029-30, followed by another 97 aircraft by 2033-34. At the same time, the company is in talks with GE for a deal on GE-414 engines, which is expected to include 80% transfer of technology to support India’s defence manufacturing goals.

At the same time, India is making progress toward its long-term goal of becoming self-reliant in defence technology. As part of this effort, it is collaborating with French engine maker Safran to jointly develop an indigenous fighter jet engine, which will strengthen India’s capability to produce advanced engines within the country in the future.

The comes at a time when India-China relations are under strain following Donald Trump’s decision to impose a 50 per cent tariff on New Delhi over its trade with Russia.

HIGHLIGHTS

  1. India is close to finalizing a USD 1 billion (about Rs. 8,300 crore) deal with US company GE to buy 113 more GE-404 engines for its homegrown Light Combat Aircraft (LCA) Tejas.
  2. Talks are almost complete for these engines, which will power 97 additional LCA Mark 1A fighter jets.
  3. The deal will help HAL (Hindustan Aeronautics Limited) meet its full requirement of 212 GE-404 engines without supply disruptions.
  4. HAL plans to deliver the first 83 LCA Mark 1A jets by 2029-30 and the next batch of 97 jets by 2033-34.

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