In announcing their agreement at the Paris Airshow, Lockheed and Tata said moving the production base to India would still retain jobs in the US.

Weeks ahead of Prime Minister Narendra Modi’s first meeting with U.S. President Donald Trump, U.S. aircraft major Lockheed Martin and Tata Advanced Systems Limited (TASL) signed an agreement to make the F-16 Block 70 fighter aircraft in India to meet the IAF’s single-engine jet requirement.

The IAF is about to initiate the process for selection of a single-engine fighter aircraft to replace the Russian MiGs under the Strategic Partnership model of the Defence Procurement Procedure. The announcement from Paris Air Show, where among those present was Ratan Tata, came ahead of Mr. Modi’s meeting with Trump later this month.

“This agreement builds on the already established joint venture between Lockheed Martin and Tata and underscores the relationship and commitment between the two companies,” said N. Chandrasekaran, chairman of Tata Sons.

The Strategic Partnership model has four segments — submarines, single-engine fighter aircraft, helicopters and armoured carriers/main battle tanks — and specifically intends to open up defence manufacturing to the private sector. The deal for 100- plus fighter aircraft is estimated to be worth over ₹60,000 crore.

The contenders for the deal are F-16 of Lockheed Martin and Gripen of SAAB. The likely Indian private sector players in the race are TASL and Mahindra group, both of which have a footprint in the aerospace sector.

The statement also said F-16 production in India would support thousands of Lockheed Martin and F-16 supplier jobs in the U.S., create new manufacturing jobs in India, and position Indian industry at the centre of the most extensive fighter aircraft supply ecosystem in the world.

While Mr. Modi has put forward the ‘Make in India’ initiative to develop the manufacturing sector in India, Mr. Trump has given a call, ‘America First,’ to get jobs back to the U.S.

TASAL has an existing partnership with Lockheed under which it manufactures airframe components for the C-130J airlifter and the S-92 helicopter.