The Indian government has named Dassault Aviation’s Rafale offering ahead of the Eurofighter Typhoon as the “lowest bidder” in the competition to supply at least 126 medium multi-role combat aircraft (MMRCA) to the Indian air force, Aviation Week has learned.

The development effectively means Rafale has won the $11 billion competition unless contractual talks now due to unfold in the coming months derail and prevent a deal from being signed. Industrial offset and other details still need to be worked out.

“It’s a long process and [the deal] is not expected to be signed in the current financial year,” Defense Minister A. K. Antony said.

The first 18 aircraft will be bought off the shelf, with the rest to be made in partnership with an Indian company. Indian plans already call for more than 126 fighters to be acquired.

“The companies found out this afternoon,” a British High Commission source told Aviation Week. “India’s Ministry of External Affairs briefed the four embassies immediately afterwards. The countries were told that this was a decision taken on the basis of cost for this contract. Nothing further should be read into this regarding bilateral relationships.”

Securing the contract in India would be a huge win for Rafale, representing the first export order for the type. Rafale is the only current-generation western fighter not to have secured an export order so far.

MBDA also is a big industrial winner, since it will provide much of the weapons package for the Indian Rafales.

Another big winner, at least politically, if the deal is cemented would be French president Nicolas Sarkozy, who has made securing a Rafale order a government priority. Sarkozy faces reelection in April/May and is trailing in the polls.

It is the second big setback for Eurofighter in as many months, having lost to the F-35 in Japan last month. EADS led the campaign in India — the four-country consortium split who leads campaigns overseas.

The Boeing F/A-18E/F, Lockheed Martin F-16, Saab Gripen and MiG-35 were eliminated from the contest first, last year. India’s government opened the Eurofighter and Rafale bids on Nov. 4 and had since been studying details before the Jan. 31 announcement.

For Rafale, the deal could help it bolster its case in other export campaigns, including the United Arab Emirates and Brazil. For Eurofighter, attention now turns to trying to build its backlog through other contracts. High on the agenda is finalizing terms with Saudi Arabia for 48 more Typhoons, selling a dozen fighters to Oman, and the fighter competition in Malaysia.