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C-17 Globemaster III
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Defense News reports that India is negotiating to buy 10 C-17A Globemaster III heavy transports for its air force, and claims that a $1.7 billion deal is likely to be finalized “by early 2010.” The report adds that:

“The C-17’s advantages include its easier handling (compared with the IL-76) and ability to operate from short and rough airstrips, added the sources…. The Indian military needs to do three things: augment its ability to quickly lift larger numbers of troops as it views possible threats on its border with China; strengthen its presence on the Pakistani border; and fight terrorism and low-intensity warfare, said a senior Defence Ministry official. India needs to triple its lift capacity, said the official.”

IAF IL-76MD
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The article correctly notes that C-17 costs would be about 300% of the Russian IL-76, which India already operates as transport, aerial refueling (IL-78), and AWACS (IL-76/A-50 Phalcon) aircraft. Purchases by countries like Jordan indicate that a stretched IL-76MF with westernized avionics would sell in the $50-75 million range, and the aircraft does have some rough field capability. In contrast, the C-17’s price tends to hover near a modern 747’s, at around $200-250 million. Australia spent about $1.4 billion, and Canada about $1.6 billion, to buy and induct 4 C-17As into their respective air forces; the USA, who does not have the extra expenses that accompany any new fleet aircraft type, was set to spend $2.5 billion for 10 C-17s in the Senate’s FY 2010 defense budget. A $1.7 billion budget might buy India 5 operational C-17s, but it’s very difficult to see how it could buy 10.