India on Tuesday selected the French Fighter Rafale over the Eurofighter Typhoon in a multi-billion dollar contract for the supply of 126 Medium Multi-Role Combat Aircraft (MMRCA) — the country's largest defence deal to date.

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Interestingly, for a company that faltered at the start, with the Defence Ministry indicating that the Rafale was out of the race, Dassault made a comeback and went on to win the bid.

The decision to open exclusive negotiations with Dassault was acclaimed by French President Nicolas Sarkozy, who praised the “very high-level, fair and transparent competition involving the two European finalists.”

While expressing disappointment over the development, Cassidian — the defence and security division of the European Aeronautic Defence and Space Company, which manufactures the Typhoon — maintained in a statement that it had offered the IAF the most modern aircraft available.

Sources in the Defence Ministry said the product was picked up on the basis of it being the Lowest Bidder (L1), a decision arrived at after complex calculations, including the life-cycle costs. The two aircraft were chosen from a list of six, including U.S. Boeing (F/A18) and Lockheed Martin (F-16), Russian MiG-35 and Swedish Saab (Gripen), in April last year.

The deal is estimated to be worth $10.2 billion (Rs.54,000 crore). The plan includes acquiring 126 aircraft, 18 of them in fly-away condition and the rest to be made in India at the Hindustan Aeronautics facility under transfer of technology.

For France, the deal is the third big defence contract that has come its way. In the current financial year, the Government of India cleared the $2.4 billion upgrade of 51 Mirage-2000 aircraft and the $970 million supply of MICA fire-and-forget missile for the same aircraft.

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