Eurofighter down to last two in £6.6bn India race

A fighter aeroplane made by a European consortium that includes Britain's BAE Systems has reached the final shortlist of two contenders as India ponders where to award a £6.6bn contract for 126 aircraft.

While there was no official statement from the Indian government, ministers are understood to have whittled down the original shortlist of six options to the Typhoon jet made by the consortium Eurofighter, and the Rafale, produced by French manufacturer Dassault.

Four others – produced by Boeing and Lockheed Martin, both of the US, Sweden's Saab and Russia's MiG – have lost out. While officials at Eurofighter and Dassault quietly smiled, the US made no attempt to hide its displeasure at missing one of the biggest ever arms export orders, despite the personal lobbying of Barack Obama. The US Embassy in Delhi said the US was "deeply disappointed" that neither of its companies had been selected.

Confirmation of the US's failure came on the day that its ambassador, Timothy Roemer, announced he was resigning for what he said were "personal, professional and family considerations". The embassy declined to comment on whether his resignation was linked to the failed tenders.

Mr Roemer had been at the forefront of efforts to lobby for an American supplier, though some reports said the US aircraft – Lockheed Martin's F-16 and Boeing's F/A-18 Super Hornet – did not meet the Indian Air Force's technical requirements.

As India seeks to extend its global political and strategic influence, the government in Delhi is poised to spend $50bn over the next five years to upgrade its capabilities. Much of its armed forces is equipped with Soviet-era hardware. The deal for the 126 fighter jets would sharply elevate its air power and allow it deploy near both the western and north-eastern borders, where it sees Pakistan and China as potential threats.

The Eurofighter is made by the four-nation European Aeronautic Defence and Space consortium, representing Germany and Spain, Britain's BAE Systems and Italy's Finmeccanica. Whichever of the two remaining bids is selected, the Indian authorities have said 18 of the 126 jets will be bought in "fly away" condition and the remainder will be made in conjunction with an Indian manufacturer.