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India and France expand defense manufacturing ties

India and France expand defense manufacturing ties

Money Moves

From Buyer-Seller to Joint Production Partners

February 17th, 2026: HAMMER Missile MoU Signed at Defence Dialogue

Overview

India has depended on Russia for weapons since the Cold War. That dependence peaked at 76% of arms imports in 2009-2013 but has now fallen to 36%—while France has surged to become India's second-largest supplier, accounting for 33% of defense purchases. On February 17, 2026, the two countries signed an agreement to manufacture HAMMER precision-guided missiles in India, marking a shift from France selling finished weapons to both nations building them together.

The HAMMER deal coincides with negotiations over a potential $28-40 billion purchase of 114 Rafale fighter jets—India's largest-ever arms procurement. If finalized, 90 of those jets would be manufactured domestically. For India, the stakes are existential: its Air Force operates just 29 combat squadrons against a sanctioned strength of 42, a shortfall of roughly 200 fighters. For France, India represents both a massive export market and a strategic partner in the Indo-Pacific, where both nations are pushing back against Chinese expansion.

Play on this story Voices Debate Predict

Key Indicators

36%
Russian arms share
India's arms imports from Russia, down from 76% a decade ago
33%
French arms share
France is now India's second-largest defense supplier
29/42
IAF squadrons
Indian Air Force operates 13 squadrons below authorized strength
$28-40B
Rafale deal value
Estimated cost of 114 additional Rafale jets under negotiation

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People Involved

Organizations Involved

Timeline

January 1998 February 2026

15 events Latest: February 17th, 2026 · 3 months ago Showing 8 of 15
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  1. HAMMER Missile MoU Signed at Defence Dialogue

    Latest Agreement

    Defence Ministers Singh and Vautrin sign MoU formalizing HAMMER joint production at 6th India-France Annual Defence Dialogue in Bengaluru.

  2. DAC Approves 114 Rafale Purchase

    Procurement

    India's Defence Acquisition Council approves procurement of 114 Rafale jets estimated at ₹3.25 lakh crore ($28-40 billion), the country's largest-ever defense buy.

  3. BEL-Safran Joint Venture Agreement Signed

    Partnership

    Bharat Electronics Limited and Safran sign 50:50 joint venture agreement to manufacture HAMMER missiles in India with 60% local content target.

  4. Rafale-M Naval Deal Signed

    Contract

    India and France sign intergovernmental agreement for 26 Rafale-M naval fighters for Indian Navy, worth approximately $6 billion.

  5. Modi Guest of Honor at Bastille Day

    Diplomatic

    PM Modi attends Bastille Day celebrations as guest of honor, signaling the depth of India-France ties.

  6. Strategic Partnership Turns 25

    Milestone

    India and France adopt 'Horizon 2047' roadmap to strengthen the partnership for the next 25 years.

  7. First Rafales Arrive in India

    Delivery

    First five Rafale jets land at Ambala Air Force Station, beginning India's fourth-generation fighter upgrade.

  8. MRFA Request for Information Issued

    Procurement

    India issues new RFI for 114 Multi-Role Fighter Aircraft, reviving the abandoned competition with eight aircraft responding.

  9. 36-Jet Rafale Contract Signed

    Contract

    India and France sign €7.87 billion (approximately $8.7 billion) government-to-government agreement for 36 Rafale jets.

  10. Original MMRCA Tender Withdrawn

    Procurement

    India officially withdraws the 126-aircraft MMRCA tender, ending years of negotiations over technology transfer and local production.

  11. Modi Announces 36-Jet Rafale Deal

    Announcement

    During Paris visit, PM Modi announces India will acquire 36 Rafales in flyaway condition, abandoning the 126-jet tender citing 'critical operational necessity.'

  12. Dassault Rafale Wins MMRCA Bid

    Procurement

    After technical evaluation, India selects Rafale as winner of 126-jet competition due to lower life-cycle costs, but contract negotiations stall.

  13. India Launches MMRCA Competition

    Procurement

    India issues tender for 126 Medium Multi-Role Combat Aircraft, inviting bids from six manufacturers including Dassault, Boeing, and Eurofighter.

  14. India-France Strategic Partnership Launched

    Agreement

    India and France establish their first-ever strategic partnership, predating India's partnership with the United States by seven years.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

1998 - Present

BrahMos Joint Venture (1998-Present)

India's DRDO and Russia's NPO Mashinostroyenia formed a 50.5/49.5 joint venture to develop the BrahMos supersonic cruise missile. The partnership started with $250 million in capital and has since produced missiles for India's army, navy, and air force, with 65% of components manufactured in India by 2018.

Then

BrahMos became operational in 2006 and was successfully deployed in Operation Sindoor in 2025, demonstrating combat effectiveness.

Now

The joint venture established a template for India's defense co-production model, with over 200 Indian companies now in the supply chain. BrahMos exports to the Philippines marked India's first major cruise missile sale abroad.

Why this matters now

The BEL-Safran HAMMER partnership explicitly follows the BrahMos model—50:50 joint ventures targeting high local content. BrahMos's success after initial skepticism suggests joint production can work if India commits to long-term industrial integration.

1990s - Present

HAL-Rolls Royce Adour Engine Partnership (1990s)

Hindustan Aeronautics Limited (HAL) licensed production of Rolls Royce Adour engines for the SEPECAT Jaguar strike aircraft operated by the Indian Air Force. HAL manufactured engines domestically with technology transfer from the UK.

Then

India achieved licensed production capability for a modern turbofan engine, reducing import dependence for Jaguar fleet maintenance.

Now

The partnership demonstrated India could absorb Western aerospace technology, but indigenous engine development (Kaveri program) struggled despite the experience gained.

Why this matters now

This earlier UK partnership shows both the promise and limitations of technology transfer deals. India can manufacture with foreign know-how but has found it harder to develop fully indigenous capabilities—a key question for HAMMER and Rafale production.

August 2007 - July 2015

Indian MMRCA Competition (2007-2015)

India issued a tender for 126 medium multi-role combat aircraft, the largest fighter competition of its time. After Dassault's Rafale won in 2012, negotiations collapsed over technology transfer terms and local production by HAL. India withdrew the tender in 2015, eventually purchasing only 36 jets off-the-shelf.

Then

India received 36 capable Rafale fighters but forfeited technology transfer and domestic production.

Now

The Air Force's squadron shortage worsened as aging MiGs retired without replacement. The controversy became a major political issue in India's 2019 elections.

Why this matters now

The current 114-jet negotiation is a direct sequel to this failed tender. Both sides appear determined to avoid repeating the impasse—hence the explicit 'Make in India' provisions with 90 jets to be manufactured domestically.

Sources

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