The negotiations for procurement of 126 Rafale jets under the United Progressive Alliance (UPA) government fell through as Hindustan Aeronautics Ltd (HAL) did not have the required capability to produce the jets in India in collaboration with French company Dassault Aviation, Defence Minister Nirmala Sitharaman said on Thursday.
An unprecedented intervention in 2013 by the then Defence Minister, A.K. Antony, when the cost negotiation committee was giving final touches to the deal put the final nail in the coffin, Ms. Sitharaman said.
After rounds of negotiations with HAL, Dassault Aviation felt that the cost of Rafale jets will escalate significantly if they were to be produced in India, she said during an interaction with PTI editors and reporters at the news agency’s headquarters in New Delhi.
“Dassault could not progress in the negotiations with HAL because if the aircraft were to be produced in India, a guarantee for the product to be produced was to be given. It is a big ticket item and the IAF would want the guarantee for the jets. HAL was in no position to give the guarantee,” she said.
The then government could have come forward and pumped in resources into HAL, but they did not, she observed.
The Minister said she had no intention of undermining HAL, but “why could not the then defence minister say that we will pump in all the required resources into HAL. He could have done it. That was not done.” The current government was initiating steps to strengthen the state-run company.
On Mr. Antony’s intervention, Ms. Sitharaman claimed he held back the file at a stage where he did not have any role to play. However, she did not elaborate on reasons for Mr. Antony’s action.
‘They will be 9% cheaper than what was agreed upon’
Ms. Sitharaman said the weapon systems, avionics and other key add-ons to the Rafale aircraft, expected to be delivered beginning September 2019, will be “much superior” than that negotiated by the UPA, and her government was getting the planes for 9 per cent cheaper than what was earlier agreed upon.
The UPA government started negotiating in 2012 with Dassault Aviation to buy 126 Medium Multi-Role Combat Aircraft (MMRCA). The plan was for Dassault Aviation to supply 18 Rafale jets in flyaway condition while 108 aircraft were to be manufactured in India by the company along with HAL. However, the deal could not be sealed.
In 2016, the Modi government signed a government-to-government deal with France for purchase of 36 Rafale jets at a cost of Rs 58,000 crore. The Congress has been alleging irregularities in the deal.
Rebutting charges of corruption in the deal, Ms. Sitharaman asserted that people of the country have put a closure on the issue as they have trust in Prime Minister Narendra Modi. “There is a trust in the Prime Minister. He is not going to be corrupt. So with all this, I think mentally, people of India have reached a closure on it, saying there is no corruption here.”
Ms. Sitharaman ruled out calling the Opposition parties for a meeting to allay their concerns over the Rafale deal, saying they were “throwing an allegation” without any basis as well as showing no concern for operational preparedness of the Air Force.
The Congress has repeatedly criticised the deal for the 36 Rafale jets, alleging that the government was procuring each aircraft at a cost of over Rs 1,670 crore, against Rs 526 crore finalised by the UPA government.
Ms. Sitharaman said the Rs. 526 crore figure refers to the bare aircraft, capable of just flying and landing, and does not take into account the avionics, arsenal and other associated technologies that make it a complete fighting machine.
