Free market value is an interesting concept. When it comes to the issue in the OP, of 5th generation fighter technologies, I would think it's not actually a question of market value.
Look at how tightly America has held on to their 5th generation fighter technology, they won't even EXPORT their F-22's to Israel, their closest ally. Let alone allowing them to have the technology behind it.
Now yes, America is notorious for not allowing transfer of technology. But what about Russia and China? Neither has allowed any transfer of 5th generation technology either.
If India pulls this off, I would consider it as nothing less than a miracle. Russia is not a poor country, in fact they are relatively rich compared to the world average. Their greatest competitive advantage is their military technology, which is very advanced. Is it really an option for them to give it up?
I mostly agree with you. When it comes to niche top of the line technology that has no other substitute, it automatically becomes a sellers market. It's what price you set that drives the market force. And yes, in this case we are also speaking of TOT, which adds a whole new dimension to the idea.
Nevertheless, Russia wasn't the first here, in fact, given their previous track record in defence aviation, they're actually lagging, Now that china has actually entered the J20 before them.
Secondly, for a buyer, other options do exist if it's simply buying off the shelf (not taking into account time sensitivity or geo political value adds). That's where the Russians have lost their leverage I think.
In India's case, it is obviously driving a hard bargain and using all tools at its disposal to gain the most (which is what any paying customer would do including China).
So yes, I do think it will be a miracle if india pulls this off, but stranger things have happened. The game isn't simply a buyer seller equation and the considerations are about much beyond that, spanning geo politics and alignments. Also do note that this isn't the ceiling for this generation of aircrafts. By bringing in a partner, russia is deleveraging internal risk and ensuring that future funding for upgrades is also taken care of. Then there is the matter of exports which can also be increased through lowering of costs, sharing resources and infrastructure! Lastly india is not a one trick pony, as of now it buys a lot of hardware and this could cement a defense relationship for other equipment as well.
Let's see what comes off it! Russians aren't stupid and Indians are great businessmen. It's who blinks first in this negotiation will "gain more" to the neutral observer. In my opinion both perceived gains are equal.
Open your eyes while writing a post. Its not free market value, its fair market value you noob. You're not worth debating. Go play with your niece. You're better suited for that than carrying out debates here. How is mopping job going on? Trump has changed your wages? Earning well??
Aye aye aye!
Sorry for the pink shalwar. It's no use debating with a corpse.
Nevertheless if and when you do come back, do answer how "fair market value" is calculated for a product that has no buyers and is retired.
Also, do answer why the Russians agreed to the initial quote in the first place if it wasn't "fair market value" according to them.