Rafale deal: No technology transfer yet, obtaining technology has been a particular failure, says CAG

Even as the first batch of five Rafale jets were recently inducted in the Indian Air Force, no technology has been transferred yet, said the Comptroller and Auditor General (CAG) in its report tabled in Parliament on Wednesday.

Raising questions over the fulfilment of the ‘commitments’ of the contract, the national auditor said that the French manufacturer has not delivered on its promises regarding transfer of technology.

“…It was found that the foreign vendors made various offset commitments to qualify for the main supply contract but later, were not earnest about fulfilling these commitments,” said the CAG report.

“For instance, in the offset contract relating to 36 Medium Multi Role Combat Aircraft (MMRCA), the vendors M/s Dassault Aviation and M/s MBDA initially proposed (September 2015) to discharge 30 per cent of their offset obligation by offering high technology to DRDO (Defence Research and Development Organisation),” it said.

“DRDO wanted to obtain Technical Assistance for the indigenous development of engines (Kaveri) for the Light Combat Aircraft. Till date, the Vendor has not confirmed the transfer of this technology,” it added.

Former Congress president Rahul Gandhi on August 22 said that “Money was stolen from the Indian exchequer in Rafale”.

CAG in its report also noted that ‘obtaining technology transfer has been a particular failure’. It further asserted that “90 per cent of the investment by the vendors was in the form of direct purchase of goods and services from the Indian industry”.

CAG said, “It did not find a single case where the foreign vendor had transferred high technology to the Indian industry…the defence sector is ranked 62nd out of the 63 sectors in India in terms of FD and there was hardly any equipment supplied in kind to the Indian industry by the foreign vendors”.

“The (Defence) Ministry needs to review the policy and its implementation,” suggested the CAG.