January 14, 2015

Indian Defense Secretary in France for Rafale Talks

Indian Defence Secretary Radha Krishna Mathur is in Paris Monday and Tuesday to help speed negotiations on the Medium Multirole Combat Aircraft (MMRCA) program, an Indian Defence Ministry source said. A senior official of state-owned Hindustan Aeronautics Ltd. (HAL) is accompanying Mathur, the official said.

In December, Indian Defence Minister Manohar Parrikar and visiting French Defense Minister Jean-Yves Le Drian agreed to fast-track the MMRCA negotiations for the purchase of 126 Dassault Aviation Rafale fighters for US $12 billion. That figure, originally estimated in 2007, is now put at about $20 billion, the MoD source added.

The contract negotiations are on track, the official said, but refused to specify when a deal could be finalized.

"Negotiations can be stretched in big ticket deals like the MMRCA deal," the official added.

Talks with Dassault began in 2012 after Rafale was down-selected as the preferred aircraft over the Eurofighter Typhoon. Issues relating to the cost of the 108 Rafales to be license-produced by HAL and French guarantees on the delivery schedule have delayed final agreement.

Under terms of purchase, the first 18 aircraft will come in fly-away condition while the remaining 108 will be manufactured under a technology transfer process. Out of the 108 aircraft to be license-produced in India, 74 would be single-seat and 34 twin-seat aircraft.

Even as HAL is finalizing the cost of the Indian-made Rafales, HAL is insisting that Dassault guarantee the delivery schedule because hundreds of spares and subsystems will be supplied by the French.

French officials have said they can assist HAL in the delivery schedule and help lower the cost of the Indian-made Rafales, but cannot give guarantees.

An Indian Air Force official said the MMRCA negotiations would have been finalized long ago if the Indian producer had been a private sector company rather than a state-owned entity


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