In a contract released by the US Department of Defense on 14th August 2020, Lockheed Martin Corp. was awarded a $62 billion, ten-year, indefinite-delivery/indefinite-quantity (IDIQ), fixed-price-incentive contract for the production of F-16 Foreign Military Sale (FMS) aircraft.
Although the contract does not mention the country where the sales of the latest F-16V jets are aimed at, experts are sure that it is directed towards Taiwan, following the deal to procure 66 such fighters which was given a green signal by the Trump administration last year.
The indefinite-quantity deal is first of its kind and part of a new commoditization approach towards foreign military sales to America and her allies. Along with Taiwan, Morocco is also said to be a customer for 24 new F-16 Block 70 “Viper” jets.
The 62-billion contract is expected to meet its objectives till 31st December 2026, and involve 100% FMS to its partner nations.
Tensions between Taiwan and China have deteriorated to new low in recent times, with speculations of PLA mounting an invasion exercise allegedly aimed at Taiwan’s Pratas Islands, after which it deployed Marines to consolidate defenses and further put F-16s armed with Harpoon missiles on regular combat air patrols (CAPs) in the area.
The 62 billion contract awarded to Lockheed Martin could probably allow Taiwan to procure additional latest F-16 Viper jets under this continuous FMS (Foreign Military Sales) process instead of waiting to seek diplomatic permission again and again from maybe a less friendly Washington government.
The deal of 66 F-16s to Taiwan was set to be completed and delivered in stages till 2026, which coincides with the dates mentioned in the DoD contract. The initial delivery contract is for 90 (66+24) aircraft.
The People’s Republic Of China ruled by the Communist Party has threatened Taiwan repeatedly and has vowed to respond with force if the island nation officially declares its independence. The United Nations has never accepted Taiwan’s sovereignty due to Chinese pressure.
In contemporary times, the island-nation has emerged to be at the forefront of a global coalition against China and considers developing its defenses as imperative against targeted aggression from Beijing.
Taiwan was also one of the first nations to support India after clashes emerged in Galwan valley in Ladakh, which resulted in 20 Indian and unspecified number of PLA troops killed.