We had the good oppurtunity with the Marut -- Which was way advanced than the Time. The best one, in the world, and we miss the opurtunity to achieve several decades before, what we achieved today.
The biggest threat is the Internal one, because the external one on the west, have just 18, and as far as Nuclear is concerned, here is the practical/real figures of the weapon India --10, Pakistan 3-4. Unofficially, in Pakistan keep on discussing 100, 200, 300 figures.
You are talking about way long history. Actually the original plan was 250 Mirage 2000H with 50 off the shelf and rest build by HAL, but due to economical crunch, that plan was shelved to 50 off the shelf.
That Low level flight is necessary to avoid the enemy Ground Radar, for the DPSU -- Deep Strike tactical strike. For that IAF needs the Rafale with twin engine, high survivability, Omnirole, Sensor fusion, long range fighter plane. And comparing F-16V with Rafale is rubbish, because everything is not Radar, Google MDPU which is inside the Rafale, and check out how it is almost a 5th Gen. Fighter plane.
For MIG-29, it means its an Air Superiority fighter Plane, with highter thrust, high acceleration, and meant for Air Defence role.