India and France have agreed on the broad outlines for a major procurement of Rafale fighter jets, with formal contract signing expected by the end of 2026 or early 2027, according to defence sources. The planned project valued at around ₹3.25 lakh crore not only aims to strengthen the Indian Air Force’s (IAF) combat capability but also includes significant efforts to build domestic aerospace manufacturing capacity.
What the Proposed Rafale Deal Includes
The forthcoming deal would involve the acquisition of 114 Dassault Rafale fighter aircraft for the Indian Air Force. Of these:
- 18 aircraft would be procured in fly-away condition directly from France, enabling faster capability enhancement.
- The remaining aircraft would be manufactured in India, with up to 60 % indigenous content phased in, similar to India’s ongoing experience with the C-295 transport aircraft programme.
This initiative marks a continuation and expansion of India’s partnership with France in aerospace development, following earlier deals such as the 2016 Rafale contract and recent agreements for naval Rafale variants.
Upgrade Path: From F3 to F4* and Beyond
The Indian Air Force currently operates Rafale jets in the F3-R plus configuration, a version customised with India-specific enhancements. Under the planned procurement, the new fighters will be built to the F4 standard* (pronounced “F4 star”), a configuration that improves connectivity, situational awareness, and combat networking capability through upgraded satellite links, advanced communications systems, and enhanced software.
The contract will also include an option to upgrade to the next generation (F5) configuration as and when it becomes operational, allowing long-term technological relevance.
Indigenous Production: Nagpur Final Assembly Line
A significant feature of the planned deal is the establishment of a Rafale Final Assembly Line (FAL) in Nagpur, Maharashtra, under Dassault Reliance Aerospace Limited (DRAL), a subsidiary of French aerospace major Dassault Aviation. This line is expected to assemble the majority of India-manufactured Rafales and will ultimately serve as a second assembly hub alongside Dassault’s facilities in France.
This facility is expected to support:
- domestic aircraft production for the Indian Air Force
- the aerospace industrial ecosystem across dozens of Indian private firms
- potential global demand for Rafale jets as a manufacturing base outside Europe
Several Indian companies including Tata, Mahindra, Dynamatic Technologies Limited and more than three dozen others are likely to be part of the broad supply chain supporting the project.
Strategic Importance for India’s Defence and Industry
The prospective Rafale deal and associated manufacturing plans have multiple strategic implications:
1. Air Power Enhancement
Delivery of 114 modern multi-role fighters will significantly bolster the Indian Air Force’s strike, air-defence, and networked combat capabilities, especially amid evolving aerial threats.
2. Indigenisation and Make in India
With up to 60 % indigenous content on later-built aircraft, India moves closer to self-reliance in advanced aerospace production – a longstanding policy objective under the “Make in India” initiative.
3. Employment and Industrial Growth
Setting up a final assembly line and a multi-tiered supplier ecosystem will create jobs and deepen technological know-how within India’s defence and civil aerospace sectors.
4. Export Potential
The Nagpur assembly hub is planned to not only serve the Indian order but also potentially fulfil global demand, positioning India as a significant player in commercial fighter production.
Delivery Timeline and Outlook
If formalities are completed in late 2026 or early 2027, deliveries of the first 18 fly-away Rafales could begin from around 2030 onwards. The phased introduction of the remaining domestically manufactured aircraft would follow over subsequent years.
The deal is also expected to be formally announced during the visit of the French President to India, mirroring the diplomatic momentum seen when the original Rafale deal was concluded in 2016.
Closing Thoughts
The impending Rafale agreement represents one of the largest defence procurements in India’s history and reflects a maturing partnership with France. Beyond enhancing the Indian Air Force’s combat strength, the associated industrial and technological collaboration underscores a shift toward indigenous capability building, a hallmark of India’s evolving defence strategy in the 21st century.