Pandeyji
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R&D is useless without actual mass production.That's not correct, tech demonstrator programmes all over the world, are aimed on developments of technologies, but with limited financial expenditures and no mass production. So if your aim is only, to improve the capability in R&D, such a programme is all that we need => NLCA MK1.
However, when you aim the development with mass production in mind, you need to comply to the operational requirements of the customer. If that isn't achieved, there will only be limited or no orders => Arjun, LCA MK1 IOC/FOC.
Not to mention that, Make in India / production of foreign products in India, also improves our manufacturing capability, even if the product is not ordered by Indian forces.