Su-30: News and Discussion

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Re: Su-30: News and Discussion

Postby pkudva » 15 Aug 2010 17:07

ppl should know, we are only paying royalty charges to Russia and the hike in prices is due to the increase in the material costs and the new upgraded components.

India is only paying to HAL and not Russia directly.

It just shows:
a. Poor reporting
b. poor planning of air force, the IAF should have signed the deal in 2007 for 150 jets rather than in bits and pieces.

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Re: Su-30: News and Discussion

Postby Mayuresh » 15 Aug 2010 18:31

^^^
Also, factually incorrect reporting. He claims that India shall be operating 330 Su30MKI in total, when that number should have been 272 - 2(crashed) = 270.

50 (initial batch, deal in 1996)+ 140 (to be manuf. by HAL, deal in 2000)+ 40 (in 2007) + 42 (in 2010) ---> Mr. Thapar reporting with complete disregard for facts. I am surprised that this jounalist (Vishal Thapar, who is no newbie to Defence Reporting) did not do any homework in an attempt to sensationalize this news report.

Secondly, I think the 42 new jets shall be built in Russia as opposed to India while the 40 jets from the 2007 agreement are to be built in India as opposed to Russia - can someone confirm or refute this, i am not able to find the source

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Re: Su-30: News and Discussion

Postby AnuragK » 16 Aug 2010 04:43

Austin wrote:Scrap MMRCA go for Su-35S with a nice 1500 T/R AESA module :)



It may be recalled that development and trial of some of the key technologies that will go into the PAK-FA started some 2-1/2 - 3 decades or so back. In this regard some of those technologies that are near maturity have been split between 2 aircraft - Mig-35 & Su-35BM. While the MiG-35 has received the preliminary AESA radar (yet to be more evolved) and the 3-D TVC that will finally go into the PAK-FA, the Su-35BM has received the 117S engine (itself a derivative of the AL41) and this or further finer refinement of this will finally go into the PAK-FA.

Hence, Su-30MKI minus canard foreplane plus 117S engine plus Irbis radar instead of BARS = Su-35BM. It may also be noted that Su-35BM has retained 2-D TVC.

All of the above or any combination of the above can at any given point of time be incorporated into the MKI as an upgrade. So, why worry???? Just imagine the MKI with AESA + 117S engine + 3-D TVC. Game, set, and match; the ultimate evolution of generation 4.75.

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Re: Su-30: News and Discussion

Postby Suresh S » 16 Aug 2010 07:01

After 800 years of occupation the 'leaders' of India can only think small.

we argue unto death whether we should have 40 or 42 squadrons for the IAF or whether we should have 270 or more Su-30 MKI,s . In my humble opinion we should have 100 squadrons in the IAF to defend ourselves properly or even go on the offensive against these lowlives in pakiland and Beijing.

Instead of feeling good about raising 2 extra mountain divisions we should be thinking of having a 100 division army( with the quality of soldier,s like in the SS minus their ugly deeds ) to kick these lowlives where it hurts.

Germany with a population 1/5 that of ours at the time of second world war had approx 5 million soldiers that is more than 200 divisions

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Re: Su-30: News and Discussion

Postby sawant » 16 Aug 2010 07:51

snahata wrote:Germany with a population 1/5 that of ours at the time of second world war had approx 5 million soldiers that is more than 200 divisions


It's doubtless that we need more, but having conscription like Germany or plain numbers like the Soviets is not going to help us in the long run. Besides such a heavily militarized nation needs to be well industrialized too, this is not the era of the Mughals where we can get by... Lets try to arm the MKIs with the latest and greatest and make every weapon count, otherwise they will just be a drag on the economy...

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Re: Su-30: News and Discussion

Postby sawant » 16 Aug 2010 07:56

snahata wrote:If I was a chinese general I would recommend to my government that this is the perfect time to attack India

No doubt GOI is culpable in every way, but for the Chinese this is not really an opportune time. Any such conflict with India today will impact the global economic recovery, weaken the currency and drive away investors... And the geopolitical gains will be questionable...

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Re: Su-30: News and Discussion

Postby Dmurphy » 16 Aug 2010 08:03

I don't know why we're so sure the latest batch of 42 a/cs is the Su-30MKI. Just because the DDM reports so? I've raised it before and I'll raise it again. They've gotto be having carrying something extra as compared to the earlier batches. May be they're Su-35 BMs. Or may be they are MKIs with pre-strengthened wings/pylons for carrying the Brahmos, IRBIS radar or some electronic gibberish?

snahata wrote: In my humble opinion we should have 100 squadrons :D in the IAF to defend ourselves properly or even go on the offensive against these lowlives in pakiland and Beijing.
"Humble opinion"? really?

And guys, this is the Su-30 thread. Look what you're discussing!
Last edited by Dmurphy on 16 Aug 2010 10:20, edited 1 time in total.

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Re: Su-30: News and Discussion

Postby AnuragK » 16 Aug 2010 09:37

[quote="Dmurphy"]I don't know why we're so sure the latest batch of 42 a/cs is the Su-30MKI. Just because the DDM reports so? I've raised it before and I'll raise it again. They've gotto be having something carrying something extra as compared to the earlier batches. May be they're Su-35 BMs. Or may be they are MKIs with pre-strengthened wings/pylons for carrying the Brahmos, IRBIS radar or some electronic gibberish?


Of course there is much more than meets the eye. The sudden and exorbitant price escalation in the Gorshkov deal + the 155% increase in 3 years in the last 42 Su-30MKI deal from USD 40 million a piece (2007) to USD 102 million a piece (2010), or even the exorbitant USD 40 million per aircraft refurbishment price for M2K to France are all shady defense deals. It may be safely assumed that these high prices do include paybacks. For example, in the Russian case, the payback is for the Arihant nuclear submarine technology; whereas in the French case, it is for the Snecma engine and some missile systems. Do you not see how the army has been forced to accept some 4000 odd French Milan-2T ATGMs (2nd gen.) very recently when 3rd/4th gen. stuff is already available. After all, for USD 40 million a piece we could have bought spanking new Jas39 Gripens, but instead we went for M2k upgrade for the same price. If we lay people can see through this, then don't you think the experts in IAF would have known? So, as I said earlier, these are all shady deals involving paybacks for services rendered. There are no free lunches and no friendship favors. It is all about money, honey.

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Re: Su-30: News and Discussion

Postby Singha » 16 Aug 2010 10:11

if we are serious about pakfa, there is no point buying a small number of su35BM - the last variant of the basic flanker. its different engine , avionics and airframe implies it cannot co-locate with other MKI squadrons and use common infra. I agree being a 15 yrs newer design it is definitely a better a/c than MKI - esp for a2a work. but Pakfa-mki will be better yet.

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Re: Su-30: News and Discussion

Postby Dmurphy » 16 Aug 2010 10:30

IMHO, the $40 million a piece price for MKI does not include the price of French/Israeli/Indian avionics that the MKI has. So the over all price of the MKI is much higher than $40 million.

Singha, my guess about it being Su-35 is entirely based on its steep price increase, which seems really improbable for same aircraft as the MKI.

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Re: Su-30: News and Discussion

Postby prastor » 16 Aug 2010 10:39

Singha wrote:if we are serious about pakfa, there is no point buying a small number of su35BM - the last variant of the basic flanker. its different engine , avionics and airframe implies it cannot co-locate with other MKI squadrons and use common infra. I agree being a 15 yrs newer design it is definitely a better a/c than MKI - esp for a2a work. but Pakfa-mki will be better yet.


Ahem... There is not going to be any PAK FA MKI this time. It is termed FGFA for a reason.

We moved from off-the-shelf to ToT to now a full fledged joint venture with FGFA. At this stage, we get to name our planes :P

Dmurphy wrote:IMHO, the $40 million a piece price for MKI does not include the price of French/Israeli/Indian avionics that the MKI has. So the over all price of the MKI is much higher than $40 million.

Singha, my guess about it being Su-35 is entirely based on its steep price increase, which seems really improbable for same aircraft as the MKI.


They are MKIs and are going to be manufactured in Russia and delivered in flyaway condition. They are more expensive because Russia is greedy, material costs have gone up and the installation of new avionics, EWC and radar. But still, I smell an engine upgrade given the extreme price hike and comparatively late delivery dates :) What say BRF experts?

ADDED LATER:

Looks like I was a bit off on the new 42 MKI deal. They are being contracted to HAL and will be built completely with 100% local parts. It comes with nothing new... that is, NO AESA or NO new engines according to Suman Sharma.

In light of this, I just can't understand what the hell IAF is doing. I am seriously concerned that this deal is way off.
Last edited by prastor on 17 Aug 2010 08:14, edited 1 time in total.

Nikhil T
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Re: Su-30: News and Discussion

Postby Nikhil T » 16 Aug 2010 10:53

pkudva wrote:ppl should know, we are only paying royalty charges to Russia and the hike in prices is due to the increase in the material costs and the new upgraded components.

India is only paying to HAL and not Russia directly.

It just shows:
a. Poor reporting
b. poor planning of air force, the IAF should have signed the deal in 2007 for 150 jets rather than in bits and pieces.


1. Can you care to explain what "material costs" have risen by 155%? What are the "new upgraded components" you are referring to (short of the conspiracy theories of the Su-35BM being contracted)?

2.Keep in mind these 42 aircrafts would be manufactured at HAL at the end of the 140 or so it would've already manufactured i.e. when it would have been manufacturing from raw material stage grounds up. Since this batch 42 is going to be manufactured in 2014-15, how can you predict the "materials cost" right now??

3. Any source on your statement that the royalty charges are the same? I would be very interested to learn if they fixed a number rather than a percentage.

You can blame the DDM for sensationalizing but AVC Kapil Kak (Centre for Air Power Studies) is no outsider to these issues.

<rant>Any time and every time we see questions being asked on price escalations, we find people passing off 'calculations' that the earlier deal was just the bare-bone unit price and the newer deal is the all-encompassing "support, weapons, infrastructure" price. Frankly such posts add nothing without sources or any offered logical explanations. </rant>

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Re: Su-30: News and Discussion

Postby AnuragK » 16 Aug 2010 11:38

Dmurphy wrote:IMHO, the $40 million a piece price for MKI does not include the price of French/Israeli/Indian avionics that the MKI has. So the over all price of the MKI is much higher than $40 million.

Singha, my guess about it being Su-35 is entirely based on its steep price increase, which seems really improbable for same aircraft as the MKI.



Please see my comments posted above on this same page regarding Su-30MKI vs Su-35BM. Alternatively, you may also see the separate thread: "Su-30MKI vs Su35BM debate" on this same site. This should clarify most of the confusion being elicited viz-a-viz these 2 aircraft. I did considerable research on this subject from various open sources over the NET after first being prompted by an article by Dr. Carlo Kopp.

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Re: Su-30: News and Discussion

Postby Dmurphy » 16 Aug 2010 12:59

Congratulations spetsnaz and thank you for your advise, but I wasn't really looking at how the MKI measured up against the Su-35BM. I was just intrigued by the "155%" price hike and was interested in knowing what really caused it and of course made a few guesses which could explain it. Never really compared the two aircrafts you've mentioned. Period.
Last edited by Dmurphy on 16 Aug 2010 13:03, edited 1 time in total.

David Siegel
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Re: Su-30: News and Discussion

Postby David Siegel » 16 Aug 2010 13:02

Can anyone comment on the current production rate of Su-30 MKI by HAL? I guess recently there were some comments about slowed down production rate compared to the projected one.

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Re: Su-30: News and Discussion

Postby nits » 16 Aug 2010 14:24


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Re: Su-30: News and Discussion

Postby Nihat » 16 Aug 2010 15:26

David Siegel wrote:Can anyone comment on the current production rate of Su-30 MKI by HAL? I guess recently there were some comments about slowed down production rate compared to the projected one.


23 are inducted in a year at the current rate. If around 120 are inducted till nw. , it would take roughly 5 more years for the remaining 110 to be ready.

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Re: Su-30: News and Discussion

Postby Singha » 16 Aug 2010 21:16

3. is tough. even the su35BM engine is said to be bigger diameter and cannot be slotted into a MKI chassis.

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 02:24

DELETED.
Last edited by Rahul M on 17 Aug 2010 19:16, edited 1 time in total.
Reason: no need to clutter the thread with commonplace information.

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 03:07

DELETED.
Last edited by Rahul M on 17 Aug 2010 19:14, edited 1 time in total.
Reason: no need to clutter the thread with commonplace information.

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 03:23

DELETED.
Last edited by Rahul M on 17 Aug 2010 19:13, edited 1 time in total.
Reason: no need to clutter the thread with commonplace information.

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Re: Su-30: News and Discussion

Postby NRao » 17 Aug 2010 04:44

AnuragK,

No need to post all that (on BR).

We wrote all that!

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Re: Su-30: News and Discussion

Postby prastor » 17 Aug 2010 08:56

AnuragK,

It is easier for forum users if you just provide a link here that we can click on to take us to the site where you copied the above text from. Such long posts in a row can make it inconvenient for us to find specific "informative but small" posts in between.

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Re: Su-30: News and Discussion

Postby prastor » 17 Aug 2010 09:04

There is a deep upgrade planned for our Sukhois right? So, are these new 42 MKIs that will be manufactured in 2015 going to meet the upgraded specs?

Or, are they based on the original specs needing immediate upgrades from Russia right after manufacturing?

Since Russia is upgrading our Sukhois with AESA and advanced avionics/EWC in the deep upgrade package, our HAL produced 42 MKIs might need a ToT on these advanced technologies for HAL to manufacture these with upgraded specs. That would explains the price hike (for the technology transfer and training).

But, if Suman Sharma is right in his article in DNA, and the 42 are going to be built to the base line specs, then it just does not make any damn sense to pay such premium price for an ordinary 4th gen MKI.

Don't you think the Defense Journalists have the responsibility now to dig deep into this, pull out their RTI applications and business cards and solve the mysteries of this deal?
Last edited by prastor on 17 Aug 2010 09:07, edited 1 time in total.

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Re: Su-30: News and Discussion

Postby Singha » 17 Aug 2010 09:05

there is as yet no talk of su30 MLU timeline or specs. it is just speculation and assumptions.

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Re: Su-30: News and Discussion

Postby Karan M » 17 Aug 2010 10:57

The Su-30 MKI MLU will take place for the first 50 planes delivered from Russia, with 2 upgraded in Russia and the rest at HAL. Timeline 2014-18.

Modernization includes a new radar, derived from the Irbis upgrade, to substantially increase the range, numbers of targets tracked, engaged, and new modes. New mission avionics, and other improvements including Electronic Warfare. Structural upgrades mentioned include, strengthening for Brahmos carriage.

Given IAF has asked for 42 additional MKI also during the same period, with cost per airframe substantially more than prior Sukhois, these may be to the new standard as well.

This upgrade however is not the fleet upgrade, for the remaining Sukhois which will get mission avionics and improvements derived from technology developed for the PAK-FA.

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Re: Su-30: News and Discussion

Postby Juggi G » 17 Aug 2010 18:08

Cross-Posting
Russians Showing their True Colours

Aircraft Deals with ‘Friend’ Russia Costing Dear
Daily News & Analysis
Aircraft Deals with ‘Friend’ Russia Costing Dear
DNA / Suman Sharma / Tuesday, August 17, 2010
0:30 IST

With an Astronomical 155% Increase in price in Three Years, the Russian Sukhoi-30 fighter Aircraft Seem to be Going the Gorshkov Way.

The deal for aircraft carrier Admiral Gorshkov was hammered in 2004 for $974 million (Rs4,560 crore), but it was renegotiated in 2010 at $2.3 billion (Rs10,770 crore).

After the Indian Air Force (IAF) wrote to the ministry of defence expressing concern at its depleting strength and pressing for immediate purchase of 40 Sukhois-30s under the fast-track provision, which does not warrant tendering or open competition, a deal was inked with Russia in 2007 for $1.6 billion (Rs7,490 crore), that is $40 million (Rs190 crore) a piece.

Latest figures tabled in parliament, however, show that another deal for 40 + 2 Sukhois (2 are replacements for aircraft that crashed last year), to be manufactured by Hindustan Aeronautical Limited (HAL) under Licence from the Russian Federation’s Irkutsk, has been struck for $4.3 Billion (Rs20,125 crore), that is $102 Million a Piece (Rs480 crore).

The latest deal will make the IAF inventory 270-strong and India the largest operator of Sukhois by 2018, when HAL is to deliver the aircraft.

But the Escalation in Cost Cannot be Justified, Especially Since the aircraft being manufactured by HAL do not have Enhanced Features, such as the AESA (active electronically scanned array) Radar. Defence Experts, in Fact, are of the View that since the Assembly Line is in Bangalore, where HAL is based, the Latest Deal should have Cost Less.

The deal becomes even more loss-making since American fifth-generation fighter aircraft, F-35, manufactured by Lockheed Martin are priced at $100 Million (Rs470 crore) a piece. F-35, an advanced stealth fighter with features such as supercruise and AESA radar, competes with fourth-generation fighters, such as Eurofighter Typhoon and the French Rafale, in Norway and Denmark for deals.

The American F-16, again made by Lockheed Martin, is competing in India for IAF’s fighter jet deal with Typhoon and Rafale.

IAF already has these four-plus generation fighters, which are awaiting clearance for upgrade in a separate deal involving Irkutsk and HAL.

The “Deep Upgrade” will include enhanced combat features, systems and avionics, which would increase the flight performance and keep the aircraft in service for a longer duration. The biggest feature of the “Deep Upgrade” is the inclusion of the AESA radars replacing the passive radars in IAF Sukhois.

The twin-engine heavy-weight Sukhoi entered IAF service in 2000 after clearance in 1997, but has not undergone any upgrade since.

(All currency conversions are based on current rate and are approximate)

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Re: False Alarm - 155% price escalation for MKI in 2015-2018

Postby AnuragK » 17 Aug 2010 19:07

Please get it in perspective. Here are the facts:
1) Prices were negotiated in 1996/1997 for ex-Russia delivery of 50 + 140 to be made at HAL.
a)Price at that point in time was USD 35 million/unit fly-away cost.
b)India paid Russia a price of USD 30 million/unit (this was minus some standard fitments which India did not want).
c)In exchange for above, India asked for some extra fittings of mixed origins(French,Israeli,Russian,Indian) for which extra cost USD 10 million/unit.
d) Brand MKI price in 1997 USD 40 million/unit fly-away cost.

For the same configuration in timeline 2015-2018 by natural inflationary accounting, the price would be we can safely assume around USD 80-85 million/unit.

The balance USD 17-22 million is obviously for the extras to keep up with tech evolution and would perhaps include the following:
1) Article 117S engine
2) Fullblown 1500/1600 T/R module AESA radar antenna
3) 3D thrust vector nozzle
4) Fuselage reinforcement costs to accommodate the engine.

So, how is USD 102 million/unit in 2015-2018 tanatamount to armtwisting/fleecing???

On the contrary, ask any CA/economist, in 1997 constant dollar terms, it would not be more than USD 50 million/unit which is by far the most competitive.

With this the hue and cry should be over.

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Re: Su-30: News and Discussion

Postby Kanson » 17 Aug 2010 19:16

For the same configuration in timeline 2015-2018 by natural inflationary accounting, the price would be we can safely assume around USD 80-85 million/unit.

The balance USD 17-22 million is obviously for the extras to keep up with tech evolution and would perhaps include the following:
1) Article 117S engine
2) Fullblown 1500/1600 T/R module AESA radar antenna
3) 3D thrust vector nozzle
4) Fuselage reinforcement costs to accommodate the engine.

So, how is USD 102 million/unit in 2015-2018 tanatamount to armtwisting/fleecing???


Have you taken into the account that the probable 117S will be in replacement of the current Al-31FP engine and similarly the radar and hence you have to subtact the cost of these items at that time to arrive at the appropriate figure.

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Re: Su-30: News and Discussion

Postby nrshah » 17 Aug 2010 19:51

Although not claimed to be accurate, just to give idea on how the inflation works:

I this data from the following website:
http://www.indexmundi.com/g/g.aspx?c=in&v=71

Data is Consumer inflation rate in India from 2000-2009. it is as follows
2000 6.7
2001 5.4
2002 5.4
2003 5.4
2004 3.8
2005 4.2
2006 4.2
2007 5.3
2008 6.4
2009 8.3

Since we have price of MKI at 1997 to be 40 MN usd, i have started from the same.. I have assumed inflation for 1998 and 1999 to be 3% (Very conservative) Also,from 2010 to 2014, I have assumed rate of 4% (Although it is already in double figure and does not indicate to come down in near future)

And this is what i come to :

Year ----------Inflation Rate ----------Cost
1997 -------------0---------------- 40
1998-------------3------------------41
1999 -----------3---------- 42
2000 -------------6.7--------- 45
2001 ----------------5.4------------ 48
2002--------------- 5.4--------- 50
2003--------------5.4-------------- 53
2004--------------3.8--------------- 55
2005-------------4.2-------------- 57
2006----------- 4.2---------------- 60
2007----------------5.3 -------------63
2008 ------------------6.4 -------------67
2009-------------------8.3-----------------73
2010----------------- 4 -------------75
2011-------------4------------------78
2012--------------- 4--------------------82
2013------------ 4----------------- 85
2014------------- 4------------------88

That is around 88MN of the same version of 1997.... (Again might not be accurate, just to give an idea)

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 19:58

Kanson wrote:
For the same configuration in timeline 2015-2018 by natural inflationary accounting, the price would be we can safely assume around USD 80-85 million/unit.

The balance USD 17-22 million is obviously for the extras to keep up with tech evolution and would perhaps include the following:
1) Article 117S engine
2) Fullblown 1500/1600 T/R module AESA radar antenna
3) 3D thrust vector nozzle
4) Fuselage reinforcement costs to accommodate the engine.

So, how is USD 102 million/unit in 2015-2018 tanatamount to armtwisting/fleecing???


Have you taken into the account that the probable 117S will be in replacement of the current Al-31FP engine and similarly the radar and hence you have to subtact the cost of these items at that time to arrive at the appropriate figure.



please read the last sentence/paragraph of my post......"in 1997 constant dollar terms" for the configuration of 2015-2018 - USD 50million/unit. That is pretty clear and should lay to rest all speculation.

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 20:03

nrshah -

thanks for the info. and much appreciated.

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Re: Su-30: News and Discussion

Postby Kanson » 17 Aug 2010 20:06

You are not getting the point, do you?

Yes, the inflation rise will increase the cost to $ 80-85 m/unit. Accepted. I couldnt agree with your assessment of extra ~ 20 m USD for the radar & engine. Becoz, it will be replacment to the exisiting one where you need to deduct the price. And the cost(not the price) of the replaced ones will be more or less in the same ball point figure. So i see no justification for the 100 million mark. 80 million is Ok.

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Re: Su-30: News and Discussion

Postby AnuragK » 17 Aug 2010 21:10

Kanson wrote:You are not getting the point, do you?

Yes, the inflation rise will increase the cost to $ 80-85 m/unit. Accepted. I couldnt agree with your assessment of extra ~ 20 m USD for the radar & engine. Becoz, it will be replacment to the exisiting one where you need to deduct the price. And the cost(not the price) of the replaced ones will be more or less in the same ball point figure. So i see no justification for the 100 million mark. 80 million is Ok.



It seems you do not understand the concept of constant dollar terms. Let me try to explain this to you as best as I can. This is how it goes:

Price for the the full up-to-date revamped model as stated is USD 102 MN in 2015. Now, you have to use net present value tables and apply either internal rate of return or net present value formula assuming 5% annual rate of inflation. This will give you the price at 1997 constant dollar terms which will be somhere around USD 47 MN. I have only rounded it off to 50 MN to err on the conservative side. If you are unable to grasp this, then please consult and seek help from a chartered accountant.

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Re: Su-30: News and Discussion

Postby sum » 17 Aug 2010 21:43

Is some other hidden stuff being passed off along with this deal ( similar to SSBN consultancy fees etc)?

Else cant imagine a 100$ a plane when the same was $40mn in previous batch ..

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Re: Su-30: News and Discussion

Postby Singha » 17 Aug 2010 22:17

thats my guess....there are certain areas of 'co-operation' with Rus that cannot be accounted for in a open balance sheet. so nothing better than over invoice some regular items and make the payment. even the AG could have an element of it.

kmkraoind
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Re: Su-30: News and Discussion

Postby kmkraoind » 17 Aug 2010 23:18

One noob questions. Everybody is taking of change of new engines. Whats the process, is it buyback agreement or buying new one to replace older ones. What happens to older ones. Can we use these engines, like making missiles, converting to them marine engines, building UAVs around (for kamikaze loitering), or they have to be junked just like that.

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Re: Su-30: News and Discussion

Postby Kanson » 17 Aug 2010 23:21

AnuragK wrote:
Kanson wrote:You are not getting the point, do you?

Yes, the inflation rise will increase the cost to $ 80-85 m/unit. Accepted. I couldnt agree with your assessment of extra ~ 20 m USD for the radar & engine. Becoz, it will be replacment to the exisiting one where you need to deduct the price. And the cost(not the price) of the replaced ones will be more or less in the same ball point figure. So i see no justification for the 100 million mark. 80 million is Ok.



It seems you do not understand the concept of constant dollar terms. Let me try to explain this to you as best as I can. This is how it goes:

Price for the the full up-to-date revamped model as stated is USD 102 MN in 2015. Now, you have to use net present value tables and apply either internal rate of return or net present value formula assuming 5% annual rate of inflation. This will give you the price at 1997 constant dollar terms which will be somhere around USD 47 MN. I have only rounded it off to 50 MN to err on the conservative side. If you are unable to grasp this, then please consult and seek help from a chartered accountant.


Sigh.............now the 1997 value is 50 m USD ? So you take the 102 m USD in 2015 and go back to 1997 to say 50 m USD value is comptetitive.

And it is not you start from 1997 40 m USD to calculate the value in 2015(which is around 85 m USD) and then compare that value to the proposed figure which is 102 m USD?

So this how you do 'adjusting' in accounting...to say all is well?

Sigh


AnuragK wrote:Please get it in perspective. Here are the facts:
1) Prices were negotiated in 1996/1997 for ex-Russia delivery of 50 + 140 to be made at HAL.
a)Price at that point in time was USD 35 million/unit fly-away cost.
b)India paid Russia a price of USD 30 million/unit (this was minus some standard fitments which India did not want).
c)In exchange for above, India asked for some extra fittings of mixed origins(French,Israeli,Russian,Indian) for which extra cost USD 10 million/unit.
d) Brand MKI price in 1997 USD 40 million/unit fly-away cost.

For the same configuration in timeline 2015-2018 by natural inflationary accounting, the price would be we can safely assume around USD 80-85 million/unit.

The balance USD 17-22 million is obviously for the extras to keep up with tech evolution and would perhaps include the following:
1) Article 117S engine
2) Fullblown 1500/1600 T/R module AESA radar antenna
3) 3D thrust vector nozzle
4) Fuselage reinforcement costs to accommodate the engine.

So, how is USD 102 million/unit in 2015-2018 tanatamount to armtwisting/fleecing???

On the contrary, ask any CA/economist, in 1997 constant dollar terms, it would not be more than USD 50 million/unit which is by far the most competitive.

With this the hue and cry should be over.

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Re: Su-30: News and Discussion

Postby Rahul M » 17 Aug 2010 23:24

kmkraoind wrote:One noob questions. Everybody is taking of change of new engines. Whats the process, is it buyback agreement or buying new one to replace older ones. What happens to older ones. Can we use these engines, like making missiles, converting to them marine engines, building UAVs around (for kamikaze loitering), or they have to be junked just like that.

no confirmation or even indication of new engines. even if we do have newer engines it would be iterations of the one currently in use rather than PAKFA engines as is being kite-flown in this thread.

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Re: Su-30: News and Discussion

Postby arnab » 18 Aug 2010 05:01

It is absurd to make 'constant dollar' arguments to justify price hikes for something assumed to be technologically the same. For instance we paid $2 million a piece for the Mig 21 FLs in mid 1975 - That works out to $30 million in today's prices - so would you suggest we buy that product today?

CPI relates to 'consumer prices' and has no relevance to technology driven products. A laptop in 2010 is cheaper and is more powerful than one available in 1997 (So in constant price terms the technology index is negative). So a higher price for technology intensive items are only justified if a better technology is being offered.


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