Mid-air refuelling has been a critical capability gap for the IAF. Tankers are valuable force multipliers for air forces such as India’s, which operate fighters for long-distance missions. Mid-air refuelling almost doubles the operating range of fighters. Refuelling them mid-mission saves a trip back to base, and a landing and take-off.

IAF currently uses six Russian IIyushin-78 tankers, first inducted in 2003, but they are facing maintenance and serviceability issues.

There have been efforts under way to procure new mid-air refuellers, with both Boeing and Airbus in contention. India has been in talks with France to lease one A330 multi-role tanker transport (MRTT) from the French Air Force for training purposes under a government-to-government deal.

With leasing of defence equipment now permitted under the Defence Acquisition Procedure of 2020, the IAF could also lease, rather than buy refuellers.

Under the pact, HAL will convert civil aircraft into mid-air refuelling aircraft with cargo and transport capabilities. The contract pertains to converting the Boeing 767 passenger aircraft, which is also used by the Italian and Japanese militaries.

Boeing has a specialised tanker – KC-46 Pegasus – a variant of Boeing 767. The conversion of passenger aircraft into cargo and tankers has been a lucrative business for IAI, which has emerged as a key player in this business.

India is looking at converting at least six aircraft into tankers. The development is a setback to Airbus, which had emerged as the frontrunner in the IAF’s plans to get mid-air refuellers.

The contract between HAL and IAI, Boeing will be a key component to any future programme to convert passenger aircraft into tankers since they are the original equipment manufacturer (OEM).

In two abortive procurement attempts in the past 15 years, the IAF has floated tenders to Ilyushin and Airbus. If a tender is floated afresh, there will be a third vendor in the fray – The Boeing Company, which has developed the KC-46 Pegasus tanker aircraft for the US Air Force.

The reason for the IAF’s withdrawal of both tenders was a conflict between “procurement cost” and “life cycle cost”. Russia’s IL-78 tanker is cheaper; but the Spanish Airbus 330-200 tanker worked out cheaper in terms of life cycle costs – considering not just the acquisition cost, but also the cost of operation, maintenance and spares over a 30-year service life.

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The move, will provide India’s defence ecosystem with new capabilities and cost effective solutions in the market,” said the IAF.

“The MoU will facilitate HAL and IAI’s decades’ long expertise in developing, manufacturing and producing leading defence platforms. The scope of the MoU also covers ‘passenger to freighter aircraft’ conversion, along with MMTT conversions.

IAI has experience in modified aircraft for the IAF. In the early 2000s, IAI fitted the Phalcon radar into three IAF IL-76 aircraft, converting them into Airborne Warning and Control Systems (AWACS).

With the Russian options considered outdated, the IAF will probably have to choose between the Airbus and Boeing options.

The Airbus 330 MRTT carries more fuel than the KC-46A Pegasus – 111 tonnes, as against 96 tonnes – but which remains in many respects a civilian airliner that retains commercial airline-style seating inside for 291 passengers. The KC-46A Pegasus has modular, military style, palletised seating that can be quickly bolted on for up to 160 passengers. Alternatively, it can carry 54 stretchers with patients.

The KC-46A’s tanker-specific avionics include state-of-the-art displays developed for the 787 Dreamliner. The USAF has insisted on the “boom operator” – who operates the boom that pumps fuel at 1,200 gallons per minute into the aircraft being refuelled – having a three-dimensional view from seven cameras that look to the rear.

Airbus, however, points out that its A330-200 has won practically every MRTT contest in the world. It has logged orders from the air forces of Australia, the UK, France, Saudi Arabia, The Netherlands, Singapore, South Korea, and the UAE.

For the past decade-and-a-half, the Indian Air Force (IAF) has been trying to buy six MMTT aircraft to supplement its eight obsolescent Russian Illyushin-78 refuellers.

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