The previous United Progressive Alliance (UPA) government could not agree on the terms under which French defence-maker Dassault Aviation would manufacture Rafale fighter jets in India, and resultant negotiations delayed the acquisition process for the Indian Air Force, the defence ministry said on February 7, 2017, as the opposition scaled up attacks over the deal.
India under the UPA government had floated a tender in 2007 to procure 126 fighter jets, some of which were meant to be made in India. However, the negotiations dragged on. The new National Democratic Alliance (NDA) government after taking over in 2014 scrapped that tender and ordered 36 Rafale fighter for about Rs. 59,000 crore.
The opposition has questioned the deal.
However, the defence ministry said on February 7, 2017, 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 UPA government could not agree on the terms offered. “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,” it said.
An email to Dassault on February 7, 2017, evening remained unanswered.
Congress president Rahul Gandhi has questioned the way the deal was sealed and asked why the government has not disclosed the price. “This is the biggest deal for the backbone of the Air Force, but defence minister says we will not tell the country as it is a secret, under a deal struck in Paris…You changed the contract in Paris, did you ask the cabinet committee on security and what price have you paid for the aircraft? Please answer whether you changed the deal yourself, whether you paid more or less and whether you took permission that you were to take. It is simple. But answers are not coming,” he said.
The defence ministry said that the demand that the government disclose the details and value of the contract for the Rafale aircraft contracted in 2016 is unrealistic—in keeping with confidentiality requirements, the UPA government had also expressed its inability to disclose the price of various defence procurements, including in responses to questions in Parliament.
“The approximate acquisition cost of the Rafale aircraft has already been provided to Parliament… in not revealing the item-wise details of the contract, the government is merely following in letter and spirit the confidentiality provisions of a bilateral India-France agreement of 2008 signed by the previous government,” it said.
The defence ministry also rejected opposition questions on whether the government had explored offers by other companies.
“In another effort to twist facts, the government has asked why it did not conduct negotiations with a particular company representing a competing fighter aircraft. It seems to have been conveniently forgotten that the then government itself had rejected that company’s unsolicited offer made days after closure of the bid process, declared Rafale as the L1 bidder (lowest) and had commenced negotiations with it in February 2012,” it said.