India’s most ambitious indigenous fighter jet programme has taken a critical step forward, with three private sector firms reportedly shortlisted to develop and manufacture prototypes for the Advanced Multirole Combat Aircraft (AMCA). The shortlisted companies are Tata Advanced Systems Ltd, Larsen and Toubro, and Bharat Forge, according to an Economic Times report.

Notably, state-run Hindustan Aeronautics Ltd has not made the shortlist at this stage.

The selection follows a technical evaluation of bids from seven Indian entities. The shortlisted firms are now expected to submit commercial proposals for the prototype development phase, after which a final winner is likely to be chosen within the next three months.

Under the current framework, the selected company will work closely with the Aeronautical Development Agency to build five AMCA prototypes. The defence ministry has reportedly earmarked an indicative outlay of Rs 15,000 crore for this stage alone. Once the aircraft is fully developed, certified, and inducted by the Indian Air Force, the eventual production value is expected to be substantially larger.

As per current projections, the Indian Air Force may order around 120 aircraft in the first tranche, with deliveries targeted to begin by 2035. Subsequent variants and additional orders are expected as the platform evolves. The aircraft is designed as a fifth-generation stealth fighter with artificial intelligence enabled systems, long range strike capability, and integration with unmanned combat platforms.

The AMCA programme represents the next leap after the Light Combat Aircraft Tejas programme and is widely viewed as the foundation of India’s long-term air combat capability. Unlike earlier programmes that were heavily dependent on public sector aerospace infrastructure, this phase reflects a deliberate push to bring private industry into the core of strategic defence manufacturing.

The evaluation criteria reportedly included technical competence, manufacturing capability, development and testing experience, financial strength, and the ability to absorb a highly complex aerospace design. This suggests that the programme is not only about building aircraft, but about developing a deeper domestic ecosystem for advanced aerospace engineering.

The most significant shift is structural. For the first time, a programme of this scale and complexity is being opened to private sector leadership at the prototype stage itself. Traditionally, Hindustan Aeronautics Ltd has been central to India’s fighter aircraft production efforts. The absence of HAL from the current shortlist signals a potential redistribution of roles within India’s defence manufacturing architecture.

This also aligns with the government’s broader push for indigenisation and private sector participation under the defence self-reliance agenda. The AMCA is not just an aircraft project; it is a test case for whether India’s private industrial base can execute ultra high precision, long cycle aerospace programmes traditionally handled by state-owned enterprises.

The prototype phase outlay of Rs 15,000 crore is only a fraction of the programme’s eventual size. If 120 aircraft are ordered in the first batch, the long-term manufacturing value could run into several tens of thousands of crores over the next two decades, excluding lifecycle maintenance, upgrades, and future variants.

For the shortlisted firms, this is not a one-time contract opportunity but a potential entry into a multi-decade aerospace manufacturing franchise. It positions them at the centre of India’s future air combat ecosystem, including avionics integration, stealth manufacturing, advanced materials, and systems engineering.

While no formal government statement has been issued in the report, the evaluation structure and shortlisting itself reflect a policy preference for deeper private participation in strategic defence programmes. The involvement of the Aeronautical Development Agency ensures that design ownership remains sovereign while manufacturing capabilities are distributed to capable industry players.

For Tata Advanced Systems, Larsen and Toubro, and Bharat Forge, this development strengthens their positioning as core defence manufacturing partners for the government. It enhances visibility of future defence order books, especially in high technology segments such as aerospace structures, precision systems, and advanced materials.

For Hindustan Aeronautics Ltd, the development could be viewed as a signal that future large programmes may adopt a more competitive and distributed manufacturing model rather than a single PSU led approach.

The broader defence manufacturing ecosystem, including MSME suppliers, avionics vendors, and materials companies, could also benefit over time as the AMCA programme scales up from prototypes to serial production.