One thing is sure IAF doesn't want to repeat MKI saga and will go ahead only if everything works out as per their requirement and won't just rely on empty promises.
What MKI saga? The issue, which Vishnu Som also stated, seems to be cost related. The whole project seems to got more costly than initially estimated, which were rather bogus promises from Russian side anyway.
Capability wise, IAF wanted changes / upgrades, which have not changed for nearly the last 10 years and even last year, the Vartaraman committe by the MoD, headed by a former Air Marshal evaluated the technical and industrial sides of the programme and gave a recommendation to go forward with it.
I would even argue, that we should look at an MKI deal now, rather than a joint development anymore.
The joint development, with an own version, was the right move and a step upward from the MKI deal, but since then too little progress has been made in starting the joint programme, while requirements changed (all twin seaters, 250 units) and costs increased on the Russian side, while budgets got smaller on the Indian side.
At this point, India wouldn't benefit from a joint programme anymore, while a custom version, with and improved MKI deal, would still give us access to techs and industrial benefits, without paying too much.
