November 22, 2017

Rafale jets bought at 16% lower price than UPA deal

Rubbishing Congress' charges of wrongdoing in Rafale fighter jet deal, the government clarified that this is a fictitious assumption of a party which sat on the deal for almost a decade ignoring the important national security issues.

Top sources in the security establishment said that the cost of the government-to-government deal with France for 36 Rafale fighter jets was almost 16 per cent lesser than what the previous UPA government is projecting with better weapons and avionics. Prime Minister Narendra Modi, during his visit to Paris in April 2015, announced that India would be buying 36 Rafale fighters from France in an inter-government deal. After five rounds of negotiations, the deal was finally signed by the two defence ministers in Delhi in September 2016 for 36 fighter jets for Rs 58,000 crore.

Congress vice-president Rahul Gandhi terming this deal as a scam has been raising this issue and putting onus of asking questions on this to Prime Minister Narendra Modi. The Congress' communications department head Randeep Surjewala had alleged that the government neglected the interests of public sector Hindustan Aeronautics Limited (HAL) as Dassault Aviation, the manufacturer of Rafale aircraft refused to transfer technology to it and instead entered into an agreement with Reliance Defence.

He also alleged that the aircraft was being purchased at much higher rates than what was decided after the completion of the tender process under the previous UPA government. Surjewala said the UPA government floated a tender on August 20, 2007 for purchase of 126 medium multi-role combat aircraft (MMRCA) for the Air Force and, post negotiations, two of them — Rafale and Eurofighter Typhoon were shortlisted.

On December 12, 2012, Rafale was declared L1 vendor, the bidder whose quotation is the lowest, with base price of Rs 54,000 crore. "It was decided that of the 126 aircraft, 18 would come in fly away condition and the remaining 108 will be manufactured in India by HAL with transfer of technology," Surjewala said.

The government sources also said that the Indian Air Force will get the aircraft with far better long range missiles along with 75 per cent availability at all times as opposed to the present one,w hcih is only 50 per cent. There will also be a guarantee of getting spare parts for the fighter jets for 50 years. Time frame for supplying is also better. Sources added that since one squadron of Rafales as per the earlier tender had to be acquired in fly-away conditions, the govt decided that it would buy two squadrons to meet the bare minimum requirements of the force.

There are 16-18 planes in one squadron. The sources said that now with the Rafale coming in 2019, the Indian Air Force can buy more planes of global standards by doing proper due diligence. The deal made by the NDA government has also ensured that the French provide help for the programme for 10 years, the sources added.

Rahul Gandhi also asked why PM Modi bypassed experienced HAL and gave the deal to AA rated businessman with no defence experience. Reliance Defence said its subsidiary Reliance Aerostructure and Dassault Aviation formed a joint venture - Dassault Reliance Aerospace after a bilateral agreement between two private companies and "the Indian government has no role to play in this".

Reliance Defence claimed that the government policy of June 24, 2016 allows for 49 per cent FDI in the defence sector under the automatic route, without any prior approval.

"No approvals from the Union Cabinet or CCS were required for the formation of the aforesaid joint venture company under the automatic route," it said, brushing aside the Congress' charge that Prime Minister Modi promoted interests of a group.

Sources said that as of now there is a deficiency of fighter aircrafts and the gap needs to be filled. The government is not responsible for an offset contract between Reliance Aerostructure and Dassault Aviation as this is between private company and vendor.

Sources also justified the urgency to buy the fighter aircrafts as number of squadrons of IAF fighters had gone down to 33 instead of required 42. The Indian Air Force has repeatedly told the political establishment of requirement of at least 42 squadrons of fighter jets to protect its northern and western borders with China and Pakistan.

The then Defence Minister Manohar Parrikar had flagged this issue with Prime Minister Narendra Modi to urgently address the concerns of IAF commanders.

In another two years, IAF is going to lose another 14 squadrons of MiG 21s and MiG 27s. The IAF banks on British-made Jaguar and French-made Mirage 2000s, Su-30 MKI and MiG 29s. An upgrade of the Jaguar fighters being carried out by HAL has been delayed.


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