In the middle of reports that the deal for 12 amphibious aircraft had collapsed over pricing and technology transfer issues, Japan has said that it is negotiating the sale of Shinmaywa US-2 search and rescue aircraft with India not for any economic gain but because it considers India a friendly country.
In an exclusive interaction, ‘The Times of India’ has quoted a top Japanese defence ministry source as saying that they would look at reducing the price for the $ 1.6 billion aircraft contract in an attempt to revive the deal.
If the agreement comes into being, it will have a huge symbolic significance as a message to China about deepening security cooperation between both countries.
Japan is expecting some progress in negotiations by the time Modi visits Tokyo later this year for the summit meet.
The aircraft was meant to be deployed in the Andaman Nicobar Islands.
After Japan upturned 1967 ban on export of arms in 2014, India was expected to be the first country to purchase defence equipment from the country ith an agreement for US-2 aircraft.
India and Japan had in 2015, signed an agreement for transfer of defence equipment and technology.