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Rafale Deal Controversy: Things You Should Know

What is the Rafale deal and what are Rafale fighter jets? The Rafale fighter aircraft procurement is through an Inter-Governmental Agreement (IGA) which was signed on 23 September 2016 between the Government of India and the Government of the French Republic for the supply of 36 Rafale aircraft.The IGA stipulates that the French Government will provide 36 Rafale aircraft and the associated equipment along with the initial consignment of weapons, long term maintenance support through Performance Based Logistics and Simulators with annual maintenance.

The Rafale aircraft is a current generation multirole aircraft, capable of undertaking all envisaged day & night missions. It is a contemporary fighter aircraft and considered among the most advanced in the world. The Rafale being procured by IAF will also be equipped with advanced Beyond Visual Range Air to Air Meteor missile, short and medium range MICA Air to Air missile and precision guided Air to Ground SCALP missiles, which will enhance the capability of the Air Force and also provide strategic deterrence vis-a-vis our adversaries.

 How does the Rafale deal benefit IAF?

Rafale is a very potent weapon platform and provides a credible deterrence. Since, the number of aircraft planned for induction in the near future is relatively less than number of aircraft phasing out, the strength of fighter squadrons in IAF is down to critical levels. Therefore, the Government’s decision to procure 36 Rafale aircraft through Government to Government route thereby expediting the induction of fighters to meet the ‘Critical Operational Necessity’ of fighter aircraft is highly beneficial to the IAF. The decision is based on the need to enhance National Security. The version of Rafale aircraft being supplied to India will have much better operational capabilities than the Rafale aircraft being operated by the French Air Force and other Air Forces.

What is the difference between Rafale procurement by UPA & same by NDA?

The unit cost of aircraft derived from the package cost of 126 MMRCA project processed by UPA and 36 Rafale deal processed by NDA cannot be directly compared as the deliverables are significantly different. The UPA government’s proposal to procure 126 Rafale fighter jets was never finalised hence the price and specifics of the non-deal cannot be compared with the actual deal made by the NDA government for 36 Rafale in flyaway conditions with additional weapons, training and maintenance etc.

The 126 MMRCA procurement included 108 aircraft to be license manufactured in India. Also, the package for Manufacturer Recommended List of Spares, Role Equipment, Simulator and Performance Based Logistics is vastly different in 36 Rafale case and cannot be directly compared. However, the 36 Rafale IGA when compared to the earlier offer is better in terms of pricing, platform capability and delivery. The IGA also has a better maintenance, logistics and training package. The current procurement also includes increased duration for industrial support viz. 50 years as against 40 years in MMRCA, additional warranty for 3 most used aircraft for training, free of charge weapons storage for six months and advanced training of IAF pilots by French Air Force.

Why Hindustan Aeronautics Ltd was sidelined for the manufacturing of Rafale fighter jets in India?

The Hindustan Aeronautics Ltd was not side-lined as it is also a likely contender for offset. The current offsets policy of the Defence Procurement permits the vendors to provide the details of their Indian Offset Partners either at the time of seeking offset credits or one year prior to discharge of offset obligations through their Indian Offset Partners. Thus the OEM M/S Dasault Aviation is free to select an Indian Offset Partners and provide their details at the time of seeking offset credits, or one year prior to discharge of offset obligation. It is learnt that the OEM is exploring opportunities to engage with MSMEs, DRDO, HAL and BEL for fulfilling offsets obligations. In the present procurement only 36 Fully Formed Rafale aircraft are being procured and no Licence Manufacturing is envisaged.

What procedures were followed in procurement? Is it legal?

The procurement of 36 Rafale aircraft through an Inter-Governmental Agreement (IGA) with France was to meet the urgent need of the IAF. The entire agreement between India and France was in full conformity with the Defence Procurement Procedure-2013. The due process of mandating, conducting and monitoring of negotiations and seeking necessary approvals were followed. The approval of Cabinet Committee on Security was obtained before entering into the IGA.

 What about the transfer of technology in current Rafale deal?

The Transfer of Technology (ToT) being touted in the 126 aircraft MMRCA project was only for manufacturing under license. The 36 Rafale Offset Contracts includes investments in kind, in terms of ToT to Indian enterprises for the manufacture and/or maintenance of eligible products and provision of eligible services. Various technology acquisition projects with DRDO are presently under discussion.

It may also be noted that contrary to the impression sought, to be created by the Opposition, in the earlier proposal to procure Rafale, which ended in a stalemate, there was no provision for transfer of technology but only to manufacture under licence.  The Government was unable to agree on the terms for even that in its negotiations with the vendor, resulting in the long-drawn exercise under the earlier Government ultimately turning futile.

 Will the jets be in fly away condition?

Yes, The Joint Indo-French Statement issued on 10 April 2015 stated that in view of the critical operational necessity for Multirole Combat Aircraft for IAF, Government of India would like to acquire 36 Rafale jets in fly-away condition on terms that would be better than conveyed by Dassault Aviation as part of earlier 126 MMRCA process.

Accordingly, a total of 36 Rafale aircraft in flyaway condition are being procured through Inter-Governmental Agreement between the Government of India and France.

 Have countries like Qatar and Egypt negotiated better deals than India for Rafale given the price points?

As per the information available in the public domain, the 24 Rafale aircraft package sale to Egypt and Qatar were concluded at a relatively higher cost when compared to the cost of acquisition of 36 Rafale fighters.

 

Source – The Analyst

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