The story is that SAAB went to Israel Aerospace Industries (IAI) looking for a partnership on on developing its Gripen NG, and that the US Government forced IAI to pull out, claiming, “That Western technology in Israeli hands would make its way to the Indians.”

IAI was supposed to develop, “radar, communications and electronic-warfare – for the plane.” (See also here

According to Flight International, SAAB has stated that, “Israel was one of several options“, for the radar, though a report by Defense News categorically denies the report:

“Our AESA focus is on our partnership with Selex Galileo, which we reached in March,” a Saab spokesman said. “Together, we will jointly develop a new radar based on Selex’s AESA Vixen and PS-05/A technologies. Saab is not involved in other AESA programs.”

I’m inclined to believe that the reality falls somewhere in between.

SAAB already has a deal with Selex on the radar, and going with a second source at this time would be a major drain on resources, but the use of Israeli comm and ECM gear, particularly the latter, would be a very big selling point.

I would note that there is some history behind this that leads me to believe that there was some US arm twisting regarding the Israelis on something, because when the Gripen was sold to South Africa some years back, the US blocked the sale on “technology transfer” issues, the South African government decertified all the US bidders on all its defense programs, and State/DoD backed down, so South Africa is now flying Gripens.

Additionally, this could be a bit of marketing by the SAAB and IAI: I can see nothing that would more infuriate the Indian defens(c)e establishment than the idea that the US was refusing tech transfers to them, and such a meme would disadvantage the American competitors, the F/A-18 E/F and the F-16 IN (basically a block 60).