Modi government’s Rafale deal was ‘costlier, slower on delivery’ than UPA era offer

The Narendra Modi government’s new Rafale deal for 36 flyaway aircraft was not on “better terms” than the offer made by Dassault Aviation during the procurement process for 126 aircraft under the United Progressive Alliance government, The Hindu reported on Wednesday referring to a dissent note by three senior defence ministry officials.

The three officials – MP Singh, Adviser (Cost), a Joint Secretary-level officer from the Indian Cost Accounts Service; AR Sule, Financial Manager (Air); and Rajeev Verma, Joint Secretary and Acquisitions Manager (Air) – were the domain experts on the seven-member Indian Negotiating Team (INT), according to the report.

In a yet another revelation by the national daily in the ongoing Rafale saga, it stated that the officials had recorded their views in a strong note of dissent on 1 June 2016, concluding that the delivery schedule of the first 18 of the 36 flyaway Rafale aircraft in the new deal “was slower than the one offered for the 18 flyaway aircraft in the original procurement process”.

“The note was submitted to the Deputy Chief of Air Staff (DCAS) in his capacity as chairman of the negotiating team at the end of Rafale negotiations,” it revealed.

A dissent note by members of the Indian Negotiating Team, the report said, found that the French side's offer did not conform to the promise of better terms contained in the joint statement issued by PM Narendra Modi and ex-President Francois Hollande on April 10, 2015.

It further stated that the benchmark price determined for the aircraft and weapons packages in the new deal was €5.06 billion. However, the dissent note revealed that the final price for the whole Rafale package shot up to €7.87 billion.The final price offered by the French government was 55.6 percent above the benchmark, the experts noted.

Incidentally, in December last year, the Supreme Court had given the Narendra Modi government a clean chit on the procurement of 36 Rafale fighter jets from France and dismissed all the petitions seeking a direction to the CBI to register an FIR for alleged irregularities in the deal.

“To establish ‘better terms for price’,” the report quotes the note, adding, “the French side was repeatedly asked to align the commercial offers submitted by Industrial Suppliers in MMRCA process to the scope of supplies as per 36 Rafale procurement.” However, “the French side refused to take cognisance of this aspect.”

On the delivery of the aircrafts, the note, according to the report, stated, “In the MMRCA process, the first 18 flyaway aircraft were being delivered between T0+36 months to T0+48 months whereas in the delivery schedule offered by the French side, first 18 aircraft will be delivered between T0+36 months and T0+53 months.”

The Hindu’s latest report, however, contradicts claims made by the Modi government as defence for its version of the deal that it was a cheaper and ensured faster delivery of the fighter aircrafts. It had reportedly made the same argument before the apex court while justifying the deal of fighter aircrafts.

The report however apprehended if the dissent note put forth by the three domain experts was a part of the material submitted in a sealed cover to the top court.

Chief Justice Ranjan Gogoi, who read out the judgment for the three-judge Bench on December 14 last year, had said that no reasons were found to interfere in the procurement process for the fighter jets.

The apex court had further maintained that it was not the job of the court to deal with the comparative details of the pricing.

The report further claimed that the officials had also objected to Modi government’s acceptance of a ‘Letter of Comfort’ in lieu of a sovereign guarantee, legal issues relating to the IGA, offset issues, and Dassault Aviation’s restrictive trade practices.

The original story in the Hindu can be read here.