NEW DELHI: Is Hindustan Aeronautics Limited (HAL) being edged out of India’s most ambitious fighter aircraft programme? As the Advanced Medium Combat Aircraft project enters a decisive phase, questions are growing over whether India’s indigenous fifth-generation stealth fighter will be developed primarily by private industry, marking a potential shift away from HAL’s traditional dominance in combat aircraft manufacturing.Amid reports suggesting that HAL may be “out of the race” for the AMCA’s development phase triggered intense debate across defence and strategic circles. The timing of these reports this month has added urgency to the discussion, especially as Aero India 2025 placed fifth-generation fighters firmly in the spotlight. At the heart of the debate lies a larger question: will India’s most advanced combat aircraft be built primarily by private players, and what does that mean for HAL’s future role?

India’s push to field the AMCA, envisioned as the Indian Air Force’s future air-dominance platform, is no longer just about stealth technology and timelines. It has become a litmus test for New Delhi’s evolving defence-industrial strategy, the role of public sector giants such as HAL, and the readiness of private players to lead complex aerospace programmes.

Reports of HAL being ‘out of the race’

Earlier this month, reports emerged suggesting that HAL may not be part of the AMCA development phase. HAL’s share price fell over 8 per cent on the BSE on Wednesday after reports suggested the state-owned defence company has not been shortlisted to develop and manufacture next generation fighter jets under the Advanced Multirole Combat Aircraft (AMCA) programme.HAL is currently committed to producing 180 Tejas Mk-1A fighters, valued at around Rs 1.2 lakh crore, followed by another 108 Tejas Mk-2 aircraft. In addition, it is engaged in multiple helicopter and fixed-wing programmes, including the Indian Multi Role Helicopter (IMRH), the Light Combat Helicopter (LCH), and the Combat Air Teaming System (CATS).Following a March 2025 contract, HAL is also busy producing 156 additional LCHs for the Indian military, with deliveries scheduled to begin in 2028. On January 29 this year, HAL signed contracts with Pawan Hans for the supply of 10 Dhruv NG helicopters valued at over Rs 1,800 crore.Another reason cited for HAL’s reported exclusion is the perceived need for a parallel fighter aircraft assembly line in India, something policymakers believe is essential to meet future IAF requirements without bottlenecks.

HAL’s clarification and official stance

On February 4, HAL issued a detailed clarification addressing reports about its status in the AMCA programme. “Various media reports regarding the Advanced Medium Combat Aircraft (AMCA) programme have come to HAL’s attention. HAL has not received any official communication in this regard and, therefore, is not in a position to comment on these reports at this stage. HAL is committed to keeping all stakeholders fully informed of all developments,” the statement said.HAL also sought to underline its financial and operational strength. “HAL would like to reiterate that it has a robust confirmed order book, providing strong revenue visibility, and a healthy production and execution pipeline extending up to 2032,” it said.The PSU listed its ongoing and future programmes, adding: “HAL is simultaneously advancing multiple strategic programmes, including the Indian Multi Role Helicopter (IMRH), LCA Mk2, and Combat Air Teaming System (CATS), which will further strengthen its technological capabilities and long-term growth prospects. These programmes are expected to enter production post-2032.”It also pointed to diversification into civil aviation. “HAL is also diversifying its portfolio in the civil aviation segment with platforms such as the Dhruv NG, Hindustan 228 and the SJ 100, which will enhance revenue and provide sustainable growth in the future. HAL has strong fundamentals and is committed to delivering sustained year-on-year growth through consistent performance.”Separately, a top HAL official indicated that even if the company were not part of the initial AMCA development phase, it would not be a major blow. The programme is still at a prototype stage, and HAL expects to bid for large-scale manufacturing orders that would come a decade later.

The AMCA vision: Why it matters

The AMCA is India’s answer to the rapid evolution of air combat in the region. Designed as a twin-engine, fifth-generation stealth fighter, the aircraft is expected to incorporate low-observable shaping, internal weapons bays, advanced sensor fusion, artificial intelligence-enabled decision support, and full network-centric warfare capability. It is meant to operate deep inside contested airspace while remaining survivable against advanced air defence systems.

Strategically, the programme is driven by two pressures. First, the Indian Air Force’s squadron strength has dipped to around 30 squadrons against an authorised strength of 42.5, with at least eight more squadrons slated for retirement over the next decade. Second, China has surged ahead with operational fifth-generation fighters and has even unveiled sixth-generation prototypes such as the Chengdu J-36 and Shenyang J-50. Pakistan, meanwhile, is on course to induct at least 40 Chinese J-35A stealth fighters.Against this backdrop, the AMCA is not merely another aircraft project. It is intended to be the backbone of India’s air combat capability from the mid-2030s, with the IAF planning to induct seven squadrons, or 126 aircraft, in the initial phase.

From HAL monopoly to a new execution model

For decades, fighter aircraft production in India has effectively been the exclusive domain of HAL. From the MiG series to the Su-30MKI and the indigenous Tejas, HAL has been the principal integrator and manufacturer. However, delays in the Tejas Mk-1A programme and the sheer scale of HAL’s existing commitments have prompted the government to rethink this model.India has now finalised a new ‘programme execution model’ for the AMCA, under which private firms can bid for the project alongside HAL. Approved by defence minister Rajnath Singh, the model aims to accelerate prototype development and eventual induction by creating a more competitive and robust domestic aerospace ecosystem.Under this framework, private companies can bid independently, form consortia, or even partner with foreign original equipment manufacturers, provided they comply with Indian laws and regulations. “Private companies can also bid for the AMCA project independently, or in a joint venture with a foreign OEM (original equipment manufacturer), or as a consortium. It provides equal opportunities to both private and public sectors on a competitive basis. The bidder, of course, should be an Indian company compliant with domestic laws and regulations,” an official said.“It’s an important step towards harnessing indigenous expertise, capability and capacity to produce the twin-engine AMCA prototype. There will be a competition. It will not be handed over to HAL on a nomination basis,” he added.

Private players step into the spotlight

The shift in approach has opened the door for private industry to play a central role in India’s most advanced fighter programme. Of the seven consortia that submitted bids for the AMCA development phase, three have been shortlisted.These include Tata, Larsen & Toubro in partnership with BEL and Dynamatic Technologies, and Bharat Forge of the Kalyani Group in collaboration with BEML and Data Patterns. The selection panel assessed the consortia on technical expertise, manufacturing capability, development experience and financial strength, in addition to their existing order books.

Among the shortlisted contenders, Tata stands out as the only firm with experience in setting up a final aircraft assembly line, which it has done for the C-295 transport aircraft in partnership with Airbus. The other firms bring deep expertise in manufacturing components, wings and fuselage sections, but have not yet led a full fighter assembly programme.Other bidders that did not make the shortlist include Adani Defence & Aerospace with MTAR Technologies, Goodluck India Ltd with Axiscades Technologies Ltd, state-run BrahMos Aerospace Thiruvananthapuram Ltd, and another tie-up involving ICOMM Tele Ltd.The final development partner is expected to be announced within three months. The selected entity will work closely with the Aeronautical Development Agency (ADA) to build five AMCA prototypes by 2031, using the defence ministry’s initial allocation of Rs 15,000 crore.

Prototype phase and the road to induction

The AMCA programme received a major boost last year when the Cabinet Committee on Security cleared full-scale engineering development of five prototypes, along with a structural test specimen, extensive flight testing and certification, at an initial cost of over Rs 15,000 crore.As per existing timelines, the first AMCA squadrons will be powered by American GE-F414 engines in the 98 kilonewton thrust class. The subsequent five squadrons are planned to use more powerful 110 kilonewton engines, with options under consideration from GE, France’s Safran and the UK’s Rolls-Royce.HAL and General Electric are already engaged in techno-commercial negotiations for co-production of the GE-F414 engines in India, with 80% transfer of technology for around $1.5 billion.At Aero India 2025, ADA officials sought to reassure stakeholders about the programme’s progress. “The detailed design has been completed. The material procurement and manufacturing planning activities have been initiated. Except for the ejector seat and engines, all components are indigenous. We are working as per timelines and there is no question of delay in the project,” said H Balaji, Deputy Project Director of the programme.

Tejas delays and their shadow over AMCA

The debate over HAL’s role in the AMCA cannot be separated from ongoing concerns about delays in the Tejas Mk-1A programme. HAL has acknowledged that LCA deliveries are running behind schedule, largely due to pending certifications and delayed engine supplies.In early February, HAL said five Tejas Mk-1A fighters are fully ready for delivery, incorporating “major contracted capabilities” in line with agreed specifications. An additional nine aircraft have been built and flown, and are awaiting engines from General Electric.“All design and development issues identified are being addressed in an expedited manner,” a company statement read. HAL said it had so far received five engines from GE and described the supply position as “positive”. Future deliveries, it added, are expected to align with HAL’s production schedule.HAL CMD DK Sunil, speaking earlier, said: “This is the most important contract we have signed. Engines have the most lead time. Unlike the previous time when we first ordered 40 and then the remaining in 2021, in between which the firm had stopped production, and there was also Covid…”“…Keeping that in mind, we started negotiations even before we inked the 97 aircraft with IAF, and were able to close this deal so early. The supply under the new contract for 113 engines is expected to begin by 2027 and end by 2032. We don’t anticipate many delays.”

What the Indian Air Force currently fields

At present, the Indian Air Force does not operate any fifth-generation fighter aircraft. Its combat fleet is built around a mix of 4th- and 4.5-generation fighters, combining imported platforms with indigenous aircraft. The backbone of the force remains the Sukhoi-30MKI, which handles air dominance and long-range strike roles.

This is complemented by the Dassault Rafale, a 4.5-generation fighter equipped with advanced avionics, AESA radar and network-centric warfare capabilities.India’s indigenous effort is represented by the HAL Tejas, inducted to replace ageing MiG-21 squadrons, while legacy platforms such as the MiG-29, Mirage 2000 and Jaguar continue to serve after multiple upgrades. Collectively, these aircraft sustain India’s air combat capability until the induction of next-generation platforms like the AMCA.