Rafale deal will be better on price and delivery: French Ambassador Richier

"Everything that India and France have discussed is to set the stage for decades of cooperation," French Ambassador Francois Richier said.

Updated - September 02, 2016 11:16 am IST

Published - February 03, 2016 01:24 am IST

French Ambassador Francois Richier.

French Ambassador Francois Richier.

President Francois Hollande’s visit is not a rare one, he was the fifth French leader to be the chief guest at Republic Day…what do you think were the achievements of the visit?

Yes, this is not the first time, but each visit is unique. Compared to any other visit in the past, I feel this marked a turning point. With such a trouble world in the backdrop, and the potential of what could happen in India at the same time, this is a significant moment in Indo-French history.

Cooperation on terror, from Paris to Pathankot

It seems significant that there was a separate joint statement on terror after the meeting between Prime Minister Narendra Modi and President Hollande. What sort of cooperation do you see emerging from it?

Well, this came out of the threat of Daesh (ISIS) to the world, and to France in particular, especially after the attacks in Paris. At the same time we have seen new cross-border attacks on India. Even if the two dynamics are different, Daesh and the groups in Pakistan, it was the occasion to highlight our cooperation for years, that wasn’t always talked about.

The Prime Minister too, drew this line from Paris to Pathankot. In both attacks, there has also been criticism of the counter-terror forces, in Paris as well as during the Pathankot attacks, that despite prior intelligence on the attacks, they weren’t stopped and the security forces took more time than expected to fight the terrorists. Do you anticipate any operational cooperation between India and France on this aspect too?

I think after every attack in any country there is this kind of criticism, because most observers ignore the number of attacks, which have been stopped. Several attempts occurred in France before the November attacks, and we didn’t speak about it at that time. Margaret Thatcher used to say, leaders need to be lucky every time, while terrorists only have to be lucky once. There is always something to learn from bad experiences too, which is why after the January attacks (on Charlie Hebdo journalists); we briefed the governments of our friendly countries on the operations. Similarly, as soon as we have completed our investigations into the Paris attacks, we will be briefing India and others. We are still in the midst of an emergency, which might last 2-3 months more. So we discuss our operations, we share information, and we have exchanges like the joint exercises between the Armies. GIGN and NSG are soon going to perform joint exercises as well.

What about working together at the international-level. The joint statement records groups like the Hizbul Mujahideen, LeT, JuD, but will France assist India in having their leaders banned by the UNSC, and the prosecution of those who are banned?

The declaration on terrorism is a platform for action in a range of areas. During the joint working group meeting in 2015, we discussed all the areas. The next step is to operationalise this.

Did the leaders discuss cooperation on fighting ISIS (Daesh)?

We gave the Prime Minister a sensitive (top security) brief on what we are doing to fight Daesh. At the moment we don’t have a common agenda, but since Daesh is considered a global threat by the UN Security Council, most likely we can work on a future agenda.

Even so, India has not joint any coalition against ISIS. Would France like India to join the operations in Syria/Iraq?

Well, there are different ways of joining the coalition. You can condemn the attacks, which India has done, and at the other end of the spectrum, you can engage forces in a military operation as France is doing in Iraq and Syria as well as against al-Qaeda in Africa. Every country has to define what is most appropriate for it, but of course we would welcome India joining the fight against Daesh. What India has sent is a massage of solidarity and increased cooperation at this stage.

Has India indicated it won’t join the coalition?

We have not asked that.

Rafale negotiations: End in sight?

To turn to defence cooperation, the Rafale deal was mentioned more than once by both leaders during President Hollande’s visit. Yet even though they spoke of an Inter-governmental agreement, only a MoU got signed. How do you explain that?

Well, it is a MoU, but a MoU between the two governments, which is a step towards the signing of the IGA. The MoU is important because it freezes all that we have done since April 2015, in terms of shaping the project, the procedures etc. So everything is now set and there is only one piece missing, which is finalising the price, and that is a matter of a few weeks, hopefully. By signing the MoU, we wanted to highlight that only the last mile remains to be done.

Some would say that the pricing for a deal like this is not just a piece of the puzzle or the last mile. The pricing is the most important part, if the two sides don’t agree on pricing, what then?

I’m quite hopeful they will. Of course, the price is important, but what you must look at, is that the two countries are embarking in a cooperation that will last decades, fourty years, maybe more. There is an expectation from India that there will be ‘Make in India’ component in all future partnerships for defence aerospace, and yes this is going to happen. As this constitutes deep partnership in this area of aerospace, we are going to see something that has never been done before either by France or by India. So we are not talking just about money. Money is the last piece in the IGA puzzle, but when it is completed it will be a very large, very ambitious project. The money should not overshadow the strategic element of this defence partnership.

Yes, but in a way it has already, by holding up the IGA. Officials in the government say the price of the Rafale, which will be finalised will be lower than the price discussed during the previous UPA regime, can you confirm that?

We are committed and are on the way to demonstrate that the conditions will be better (than before). Better doesn’t just mean lower price, but additional elements. We are going to make it better on all fronts.

Could you explain that…are you saying the price of the plane may be lower, or the offsets will be reduced?

The price will be better, the conditions for delivery will be better, each and every part of the deal will be better than before.

You said it could be a few weeks, President Hollande said a couple of days….Realistically, how long do you see this price negotiation go on?

Let’s say between a few days and a few weeks. To be specific, we need to conclude negotiations, and then the Indian government will have to go over its processes for the agreement. So you have to put both sides together. If we talk about the conclusion, where we are involved, I think about four weeks is reasonable. And then there is an Indian procedure, which is not in their hands, over which we have no control.

You said much depends on the Indian government. The Rafale deal is unique because this is the first time a deal of this nature has been announced by the Prime Minister himself, and many of the details of this deal have been discussed by the Prime Minister and President directly. The invitation to Mr. Hollande was seen as a signal that the IGA was ready to sign. Given that there is such a high-level backing to this deal, has the time taken become a test-case for how quickly India can deliver?

Well, we have a direction given by our leadership that we have to work out sequentially. There are legal issues, technical issues; supply protocol given these planes will be sold in ‘flyaway’ condition. All these take time, and negotiation of price doesn’t start on day 1, so it’s very premature to say this is a stumbling block. Of course, the negotiations could be quicker, but it is completely wrong to draw any link between the President’s visit and the conclusion of the IGA. We do not negotiate contracts under pressure of time and neither does India. It is not because there is a visit that negotiations can be accelerated.

And you had no expectation of concluding the IGA in time for Republic Day then?

No, it would have been an artificial timeline and in a deal, which will commit the countries for decades, that would have made no sense.

The reason I ask is, we do have the example of another deal between India and France, the $6 billion Maitri surface to air missile (SRSAM) deal, which was first announced in 2007, stopped, started, re-announced in 2015….but no real movement on the ground. Are you worried the Rafale deal could go the way of the Maitri deal?

I think there is a strong understanding of what we can do and what India wants. This is a deal for planes in flyaway conditions, but there will be deals for ‘Make in India’ in a range of areas. This constitutes a very long-term project. Of course till the last moment anything can happen, but the commitment of the top leadership, the Indian Air Force, and the fact that even for us this is an unprecedented deal for France gives me reason to hope it will be concluded soon.

When is it that people should worry about it not being completed?

Frankly I don’t know. People should start worrying if we are not meeting anymore. If we continue to negotiate then its fine.

Nuclear project

Let’s turn then to the delays in the nuclear power project, the other highlight of the joint statement. The Jaitapur project MoU, signed in 2009, had always planned for six reactors, but there has been no movement on the ground. Are you quite confident that the 2017 deadline for concluding the agreement for the six reactors can be met?

There are two major components to the progress on Jaitapur. One that EDF (Electricite de France) has now taken over Areva (Nuclear Corporation) and thus will be the interlocutor for India, which means EDF will provide its own expertise in production and supply of electricity. They know about the concerns of the customer. The second is that the size of the project has changed. It was two and maybe four more but that wasn’t certain. Now it will be six in a row. This forces both sides to think in the long-term about producing electricity as quickly as time. India needs electricity desperately and also is committed to increase the share of non-polluting energy sources. So Jaitapur is part of the solution for India to cope with electricity crunch and the climate change challenge.

Yes, but given that only the land has been identified, and clearances still need to be renewed, how soon can this be up and running?

We have given the negotiators one year to wrap up the agreement and the issues are very well-known. The key issue is to reshape the process for six reactors without losing time and the price has to be agreed. Our goal is to start construction within a year.

India’s liability law is not an issue for France, then?

Well, that doesn’t mean we are happy with it. But we respect the Parliament here, and just now India has announced its ratification of the Convention on Supplementary Compensation (CSC) in January. So we are comfortable with that.

And is the contract between L&T and Areva for the construction of stainless steel domes for nuclear reactors that was signed in April 2015 still on track with all these changes?

Yes. Areva is a subsidiary of EDF, so the L&T and Areva cooperation will have to be a new agreement.

Bilateral trade lags behind

To come to bilateral trade, despite everything you’ve said, India-France trade today is less than the sum total of the Rafale deal. If you compare it to its neighbours, the annual trade of $8 billion is half that of Indian trade with Germany or the UK. How do you explain this?

For the simple reason that we produce in India, and we are one of the most important investors in India, and the output of French companies in India would be between 20-30 billion euros, which means roughly eight times what export. That is the reason.

But look, I do want to highlight that everything that India and France have discussed is to set the stage for decades of cooperation and that mustn’t be minimised. On defence, we are discussing, as I said a long-term partnership to build the aviation industry in India. In the nuclear deal, we have agreed to supply Jaitapur with nuclear fuel for the entire duration of the lifetime of the equipment, which could be 40-50 years. And that is a commitment to reliable, uninterrupted supplies of nuclear fuel. We want India to join the UNSC, to join the NSG and other nuclear regimes, and we have a dialogue on maritime cooperation in the Indian Ocean region. Our cooperation for a solar energy alliance is a game-changer for all countries between the tropics. It is a long-term partnership on smart cities, but also on services and infrastructure. Look at what we are doing on railways. Of course, we are disappointed that the high-speed railway contract went to Japan, but we are focusing on Delhi-Chandigarh rail track. If we are able to make its run time about an hour instead of 4-5 hours, think of how we will change the lives of the people. Replicated across India, it would take 20-30 years. So that is how we should see India and France, as partners for the long-term.

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