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Your argument is flawed because the same applies to the F/A-18, Grippen, Rafale and even the Typhoon. The benefit that the F-16 has is the immense market for upgrades for it. None of the other aircraft come even close. If LM does not offer upgrades, other companies and integrators will because they see a big opportunity to enhance the F-16 beyond what it is currently. F-16s are like the Mig-21 and Mirage III series. Even after LM assembly lines shut down, those in Turkey, Egypt will be producing spares and limited enhancements.
2. It would do you some good to look at what the current and recent buyers of F-16 are planning to do with their blk-50s and above. None of these countries are planning on retiring these aircraft before 2040 (at least 30 years of life). F/A-18 is no different. Aside from USN and USMC, which will switch to
F-35 starting this decade, only RAAF, Kuwaitis and the Swiss fly this aircraft. All the problems you ascribe to the F-16 pertaining to shortage of spares etc. are multiplied manifold for the Super Hornet. Secondly, if you will be getting the PAK-FA so soon, then why bother with the MMRCA? The reality is that IAF knows that PAK-FA will nowhere close to being ready for induction over the next 7-10 years. Thus the need to pick aircraft which are in the exact same category as the F-16.
4. USAF F-16s will be in service until the 2020s. Turks, Israelis, Greeks, Poles, Emeratis, Singaporeans and Pakistanis are pretty sane people and have bought F-16s planning to fly these for the next 4 decades. So lets not try to oversimplify the situation by claiming F-16 does not make sense. It has made sense to all of them to invest in late blocks of F-16. If the F-16 could have been negated for the reasons you describe, IAF would have eliminated it way before.
How did you come to the conclusion that the F-16 is the best of the bunch in the MRCA. It is acutally the weakest of all in the MRCA deal and LM knows that. That is the main reason why LM is hanging the carrot of the F-35 to somehow attract some attention towards the F-16. It is quite obvious that the IAF will not choose the F-16 as the PAF already operates it and because all the other contenders are better. F-16 is almost nothing in comparison with the Eurofighter in terms of A2A combat and lacks the heavy fighting capabilities of the F-18 and the Mig 35. It is already an aging platform with not much room to grow in the coming years. Yes it will remain in operation till alteast 2040 in some countries but its not by any measure the best in the MRCA. LM will be very very lucky if they get this deal.
frankly speaking IAF is the weakest point of Indian Armed Forces....and logically it should be the strongest because in conventional wars air muscle is the most decisive factor.India needs to operate at least 3000 top class aircraft to be in the league.
IAF Su-30K, RSAF F-16C/D, IAF MiG-21upg Bison, IAF MiG-27ML, IAF MiG-29B, IAF Su-30MKI