US defence major Lockheed Martin has firmed up its plans to produce the latest version of its iconic F-16 fighter jets only in India under the ‘Make in India’ programme.

The multi-billion dollar deal was “finalised” during the recent visit of Lockheed Martin’s Chairman, President and CEO Marillyn Hewson here last week, a top official, involved in the talks, told BusinessLine .

‘Exclusively’ in India

Under the deal, the company will be manufacturing the latest version of the jets – F-16 Block 70/72 – that will be produced “exclusively” in India.

This will be the “most advanced” version and will not be built anywhere else in the world. Lockheed Martin also plans to export them from the India plant at a later stage, the official said. The F-16 project is a government-to-government deal that will be conducted through the Foreign Military Sales (FMS) route.

However, it seems Lockheed Martin has no plans to take the 100 per cent foreign direct investment route for the programme. It is likely to co-produce the F-16s in collaboration with the Tata Advanced Systems Ltd., which has been its partner for other defence and aerospace programmes such as the C-130 cargo plane.

The Maryland-based firm is currently scouting for land to set up its manufacturing unit. According to sources, it is looking to set up the plant in a State that will have a runway near a port.

India had long been demanding that the F-16s it buys will have to be more advanced than what is sold to neighbouring Pakistan.

However, with the recent push on India-US defence ties, talks on setting up the F-16 plant in India have steadily progressed. The deal was “almost finalised” when Prime Minister Narendra Modi had visited Washington last month.

During this visit, Modi finalised the Logistics Exchange Memorandum of Agreement (LEMOA) with the US, which is one of the three crucial foundational agreements that strengthened India-US defence ties.

India is also negotiating the remaining two foundational pacts with US.

As a result, the F-16 programme of Lockheed Martin received a major thrust due to this strengthening of ties. Indian Air Force is in desperate need of modern fighter aircraft as it grapples with an ageing fleet.