At last Rafale fighter jets have landed – Saga of the deal from Congress regime to BJP regime

Shipments from France of Rafale jets to India have started with the first five arriving today

Shipments from France of Rafale jets to India have started with the first five arriving today
Shipments from France of Rafale jets to India have started with the first five arriving today

At last, the first batch of five Rafale fighter jets from France has landed in India on Wednesday afternoon. The Rafale deal is a very long story of 14 years ranging from Congress regime’s aborted most-corrupt-deal of 126 fighter jets purchase to BJP regime’s 36 fighter jets. A lot of corruption allegations to slugfest has been witnessed over all these years. Out of political enmity, this deal went up to Supreme Court and got cleared at last. Here we bring out the entire timeline of the Rafale saga.

Rafale deal during the Congress regime

In 2006, as part of the Indian Air Force’s (IAF) modernisation the Ministry of Defence floats a tender for purchase of 126 fighter jets, known as Medium Multi-Role Combat Aircraft (MMRCA). Why 126 jets? The answer is simple – more the quantity, more the commission. French company Dassault’s Rafale and Eurocopter’s Typhoon were the main competitors. There is no point in debating which one is good. Both sides had valid arguments. Traditionally IAF fighter planes are the Soviet Union and France and India have to avoid the machines used by Pakistan and China. After Soviet Union’s disintegration, France is India’s main supplier of planes and it is well known that the French have good relations with India in air and nuclear supplies, and their lobbies are well oiled in India.

The entire pricing structure changed after fitting all accessories. It is laughable that Congress is now claiming about their aborted deals’ 2006 based pricing and 2016 based pricing.

Rafale’s Indian partner was none other Mukesh Ambani and the Typhoon lost the game. Typhoon’s rates were fixed and Rafale’s rates were variable. Though in total Typhoon’s rates were low (comparing fixed pricing), Rafale was selected as Lowest (L1). The deal had a cock & bull story part also. Rafale will supply 18 jets directly and rest 108 will be assembled in India in association with a Public Sector Undertaking (PSU) company Hindustan Aeronautics Limited (HAL) with offset partner Mukesh Ambani’s companies. Mukesh Ambani also declared his defence companies to execute this deal. To this end, six Reliance defence firms were also floated. Though the deal value was only 7.3 Billion dollars as per 2006 rates, it was widely known that as it was a variable price model, this will go much higher. And it must be remembered that this deal was just for the bare rate of the fighter jet, sans many advanced accessories.

Those days Dassault was a financially ailing company and had only production capacity of 11 Rafale Jets per year. Rafale that time used only four countries like home country France, Qatar, Libya, and Algeria. Typhoon is widely used in many European countries including Germany and has a large customer base.  But in India, Eurcopter, the consortium of many European companies lacks Embassy based lobbying like French firm Dassault, where the French Government is also a shareholder.

That time Sonia Gandhi led Congress regime was facing all kinds of corruption charges when the deal was first finalized to Rafale in 2012. The deal was stalled by Defence Minister AK Antony when he received complaints from opposition leaders Subramanian Swamy and Yashwant Sinha. Swamy accused Sonia Gandhi and her sisters of clinching 20% commission from the then French President Nicolas Sarkozy’s wife Carla Bruni, who is also an Italian. In his complaint, Swamy pointed out using a series of documents that the selection of Rafale as the lowest cost solution was wrong, and the actual lowest cost was that of the Typhoon.  Based on Swamy’s complaint, Antony ordered a probe that literally ended the deal. Yashwant Sinha’s complaint was on the dubious activities in the selection process to favour Rafale. As Lok Sabha elections were nearing and the Congress was facing attacks of corruption in every sector, the Rafale deal literally collapsed and there was no budget allocation to pay Dassault. After losing to Rafale manufacturer Dassault, competitor Typhoon’s manufacturer Eurocopter shut their India office. Moreover, by the end of 2013, due to the Ambani brothers patching up, Mukesh Ambani handed over the Defence Sector to Anil Ambani[1].

Rafale deal during BJP

When Narendra Modi became the Prime Minister, the French authorities again started negotiations. It was obvious that Rafale’s new partner Anil Ambani was also pushing for the revival of the deal. During his visit to France in 2015, Modi announced a new Rafale deal scrapping the old deal tailored during the Congress regime. In the new deal, only 36 jets are purchased straight on fly-by condition. The entire pricing structure changed after fitting all accessories. It is laughable that Congress is now claiming about their aborted deals’ 2006 based pricing and 2016 based pricing.

The only point of criticism in the deal was the role of the debt-ridden Anil Ambani’s firms as an offset partner. His companies will get around Rs.1,000 crore offset ventures. But can he execute these ventures is a big question as many of his firms have now sunk and Anil himself faces cases from banks for huge debts. Using his first right, Mukesh Ambani may acquire Anil’s firms, say many industrialists.

Now the first batch of five Rafale fighter jets has landed in India. As per the schedule, the remaining 31 jets will land in batches of four to five every four months and the final delivery is expected to be finished by 2022.

References:

[1] Untold stories of the Rafale deal and a fact check of the allegationsSep 24, 2018, PGurus.com

Team PGurus

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