The government note in the Supreme Court does not contain a word about the “parallel parleys” conducted by the Prime Minister’s Office (PMO) with the Diplomatic Advisor to the French Defence Minister on the 36 Rafale aircraft deal even as the Indian Negotiating Team (INT) was undertaking formal negotiations with the French side.
The note, which was later shared with petitioners in the court, is mum about the objections raised in the Defence Ministry about the parallel negotiations.
It is also silent about the lack of sovereign guarantee from the French government in case the deal went wrong.
Onus on INT
In fact, the government put the entire onus of the deal on the INT. The note emphasises the INT could cull a “better” deal than the earlier junked one for 126 Medium Multi Role Combat Aircraft (MMRCA) from Rafale manufacturer Dassault Aviation.
The note highlights that the INT “completed its negotiations and arrived at better terms relating to price, delivery and maintenance as compared to the MMRCA offer of M/s Dassault Aviation... The INT report indicated better terms and conditions arrived at as a result of negotiations as compared to 126 MMRCA case and achievements of Negotiating Team”.
This implied that the responsibility for all aspects of the 36 Rafale deal, including the aircraft’s pricing, delivery, maintenance, etc., was put squarely on the shoulders of the INT by the government in the Supreme Court.
The note does not spare any details of the INT’s performance at the negotiating table in its note. It said the negotiations between the INT and the French side began in May 2015 and lasted till April 2016. It said the INT had a total of 74 meetings, which included 48 internal and 26 external INT meetings, with the French side during the period of the negotiations.
The parallel parleys of the PMO raise questions as the government’s note had made it amply clear that the INT was working on the mandate of the Defence Acquisition Council (DAC), which is the highest defence procurement body headed by the Raksha Mantri (Defence Minister), and not the PMO.
Under the instructions of the DAC, the INT undertook a “collegiate process”. This process was comprehensive in itself and involved “due deliberations and diligence at various levels during the negotiations”.
“Aspects pertaining to responsibility and obligations of the French government, pricing, delivery scheme, maintenance terms, offsets, Inter-Government Agreement (IGA) terms, etc., were discussed and negotiated during these meetings,” the note said.
The INT presented its “proposal for procurement” of 36 Rafale jets to the DAC on three occasions — September 1, 2015, and subsequently on January 11, 2016, and July 14, 2016, — for approval on various aspects of the negotiations and directions.
The INT report was finalised and signed on July 21, 2016.
The INT report, submitted by the team chairman on August 4, 2016, and the proposal for obtaining approval of the Cabinet Committee on Security (CCS) was ultimately processed in the Defence Ministry.
The note said the Ministry did inter-ministerial consultations with the Finance Ministry and Ministry of Law and Justice.
The PMO’s role, if any, is not mentioned here. Finally, the CCS approval for signing the IGA for the Rafale aircraft was accorded on the basis of the formal INT negotiations and the MoD proposal.
The extracts of the documents published in The Hindu show the INT and the MoD was irked by the PMO’s position that a sovereign guarantee was not necessary and a ‘Letter of Comfort’ would do.
The government had assured the court that a letter of comfort was as good as a sovereign guarantee. The petitioners — Yashwant Sinha, Arun Shourie and Prashant Bhushan — had countered that such a letter had no legal validity.
“Money involved in the procurement is high. Who will be responsible if Dassault does not deliver? The Law Ministry had left it to the government to decide,” Mr. Bhushan had submitted.
The court hearings revealed that the Union Law Ministry too had red-flagged the absence of a sovereign guarantee from the French government as a key “problem” associated with the Rafale deal during inter-ministerial consultations before the Inter Government Agreement (IGA) on the deal was signed on September 23, 2016.