April 5, 2013

Defence Ministry, Dassault to hold talks on aircraft deal

Amid fears of delay in the 126 combat aircraft deal, Defence Ministry and French Dassault Rafale will hold talks today to iron out differences between them over the responsibilities to be given to the state-run HAL in the contract estimated to be worth $ 15 billion.

Soon after the Rafale fighter jet was shortlisted by the IAF in 2012, its maker Dassault Aviation has been raising questions about the capabilities and the role of Hindustan Aeronautics Limited in the contract for 126 Medium-Multirole Combat Aircraft (M-MRCA).

The two sides are scheduled to meet today as part of contract negotiations where they will discuss all the problems and issues faced in the deal, sources told PTI here.

Some of the issues between the two sides include Dassault's demand for two separate contracts to be signed for the deal which includes one for the 18 aircraft to be built by the firm in France and the other for the 108 aircraft which are be integrated in India by the HAL.

The Defence Ministry is not in agreement with this demand for two separate contracts and has also conveyed this to the French firm, they said.

The Defence Ministry had earlier also rejected Dassault's demand for making it the lead integrator for the 108 aircraft to be produced in India as the RFP for the tender has specifically given that responsibility to the HAL.

Recently, Dassault Aviation CEO Eric Trappier had stated that HAL would be its main partner in the contract and there was no confusion on the issue.

Dassault has also signed an MoU with the Reliance IndustriesBSE 1.77 % Limited and wants to give a bigger role to it in the production phase in India is areas such as supply chain and project management.

Rafale had edged out five other aircraft including American F-16 and F-18, Russian MiG 35 and European Euro fighter to bag the contract.



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