The Avro replacement RFPs have gone out to an interesting bunch. Most are known more for military aircraft which will not have a meaningful civil market beyond the IAF requirement of 40. The odd couple are Boeing and Embraer but they don't have anything in the Avro category--a regional passenger plane with military transport capability. They do have a joint project called the KC390, a medium military transport but it is identical to the MTA and hence probably untouchable in India. Besides, it too won't have a civil market which is primarily passenger. A promising, low-risk civil market beyond the IAF requirement is key to this project.
IMO, Indian private coalition should try and get the BAe146 production line which has shut down and develop this plane for both military and civil use. Like the Avro-748, it is also a versatile Avro (RJ series) civil regional passenger aircraft that has played several other roles: freight, firefighter, military transport, military tanker, VVIP plane etc.
It was available in 3 basic versions and will make an ideal short and medium haul passenger jet for India with excellent export potential. It was chosen by Druk Air for flying into short and difficult mountain airstrips like Paro, so it is ideal for our ALGs. Unfortunately, 9/11 killed off the production line but otherwise it had proved to be one of the most successful regional jets in Europe. It was reportedly profitable even when operated with half the passenger seats empty.
The basic design is simple and rugged and should handle many upgrades and modifications for decades. If chosen and moved on quickly, it has a good chance of becoming operational before the MTA and giving the IAF its An32 replacement much faster. It will certainly be a lower-risk alternative to the MTA, both for Indian and foreign markets.
In the longer term, a project like this will provide a solid foundation to India's private aviation industry and allow it to blossom. Only something like this will stand a chance of breaking the HAL monopoly and letting Indian private companies show what they can do.