No the F-16 was not cutting edge. It was created as a cheap lightweight dogfighter where it could only carry sidewinders as it had no radar. The cutting edge fighter at the time was the F-15 even though it only had one role.F16 was cutting edge jet of its time and so is F35. Both are mainly for export purposes and are of multirole fighters.
IDK about DOD or State Dept but my information is correct regarding F35.
-The original F-15 had excellent pilot vision, including being able to see 360 degrees in the horizontal plane. It had strong high-speed maneuverability and a 20mm cannon. In addition to rectifying some of the F-4's deficiencies, it could fly higher and faster than the F-4, and had dramatically better climb and acceleration.
It also had a powerful radar with advanced look-down shoot-down capability, and relied on the Sparrow missile as its principal weapon.
Nevertheless, an informal but influential group called the "Fighter Mafia" objected to the F-15 as moving in the wrong direction. (The most prominent Fighter Mafia spokesmen were systems analyst Pierre Sprey, test pilot Charles E. Meyers, and legendary fighter pilot John Boyd.)
The F-15, the Fighter Mafia objected, was even larger and more expensive than the F-4. Much of that money went into creating high maximum speed (Mach 2.5) and altitude (65,000 feet) and to serving as a launcher, under BVR conditions which couldn't be used in real combat,. for the Sparrow missile which didn't work While recognizing that the F-15 had phenomenal supersonic climb and maneuverability (it could sustain 6Gs at Mach 1.6), at such speeds it could not fight because its turn radius was so large that it could not keep the enemy in sight.
What the Air Force needed, the Mafia argued, was a successor to the WWII P-51 Mustang and the Korean War F-86 Saber: an all-new small fighter that would be cheap enough to buy in large numbers. (The F-104 was not considered a predecessor aircraft because, while it had excellent climb and acceleration, its wings were too small, leaving it deficient in range and maneuverability.) The new fighter would have revolutionary maneuverability, transient performance, acceleration, and climb at the subsonic and transonic speeds at which air combat is actually fought. It would have a gun and its primary armament would be the infra-red guided Sidewinder missile that had proven highly effective in Vietnam.
While Sidewinder's range was limited to about three miles, the Mafia argued that air combat beyond that range was fantasy in any case. Some members of the Mafia even suggested that the ideal small fighter would have no radar at all, although this was a minority view.
In any case, the Air Force establishment wanted no part of a new small fighter, with or without radar. It was regarded as a threat to the F-15, which was USAF's highest priority program. But the Fighter Mafia gained considerable resonance in Congress and within the Office of the Secretary of Defense. In 1971 Deputy Secretary of Defense David Packard began a Lightweight Fighter (LWF) program to explore the concept.
The LWF was to be about 20,000 pounds, or half the weight of the F-15, and was to stress low cost, small size, and very high performance at speed below Mach 1.6 and altitude below 40,000 feet. Two competing designs would be chosen for prototyping.
Industry recognized, correctly, that regardless of USAF hostility, LWF variants had great potential for profitable foreign military sales, including replacing the F-104. Single-engine designs were put forward by Boeing, General Dynamics, LTV, Northrop, and Rockwell. Northrop also proposed on a twin-engine design, in effect using Air Force money to develop a replacement for its F-5 export fighter.
The Boeing and General Dynamics designs were the clear leaders from the beginning, with the Northrop twin-engine design clearly the weakest of the six.
F-16 Fighting Falcon - Military Aircraft (fas.org)
India never got briefed DOD and State Department didn't give LM permission. It gets reported here in the states by defense officials of such action. They released a statement when Germany and other nations got the F-35 briefing.