Hindustan Aeronautics Ltd (HAL), the state-owned aircraft manufacturer, has entered into technical collaboration with two Russian companies for building 100-seater multi-role transport aircraft.

Mohanty claimed that this model would be substantially cheaper than what is available in the market. HAL sources said each aircraft would cost 80 per cent of existing market price.

The cost of the project is yet to be worked out. Nevertheless, HAL would not seek financial support from the government for the project. "Fifty per cent of the development and design cost would be borne by the Russian partners. It would invest the entire amount from its internal accruals. The detailed project report for this would be ready by January," Mohanty added.

The aircraft would be able to carry 100 passengers which can be modified to carry 20-50 tonne of cargo. HAL is looking for acquiring the best avionics technology from Europe. For engines, which would be turbo and not jet, HAL might approach Rolls Royce or any other renowned engine manufacturer.

The Russian companies would extend the conceptual design and metallurgical know-how to HAL. It, in turn, would do the integration, production designing and commercial production of the aircraft.

Mohanty said it had also signed an agreement with a Russian company to manufacture 50-72 seater aircraft.

"Nearly 100 aircraft of 50-72 seat capacity would be needed in India during the next 10 years as regional air services will improve significantly during the period," he said.

The HAL chairman said that the 100-seater project was a major diversification for the company which would like to emerge as the third manufacturer and supplier of passenger and cargo aircraft after Airbus and Boeing.