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Rafale Deal controversy

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The Rafale aircraft deal is one of the major political allegations levelled on the BJP government by opposition parties which deals with the purchase of 36 multi role fighter aircraft which was priced around 7.8 billion euros. The controversy also claimed to have exposed crony capitalism on the present government.

What is the Rafale ?

Rafale is a French twin-engine, delta wing, multirole fighter aircraft designed and built by Dassault Aviation. It is an unique aircraft which is equipped with a wide range of weapons. It is intended to perform air supremacy, interdiction, aerial reconnaissance, ground support, in-depth strike, anti-ship strike and nuclear deterrence missions.

How Rafale aircraft was chosen by India ?

In 2012, Rafale was choosen after the Medium Multi-Role Combat Aircraft (MMRCA) competition, also known as the MRCA tender floated by Indian Defence Ministry. The Defence Ministry has allocated Rs 55,000 crore (USD 7.7 billion) for the purchase of these aircrafts, making it India's single largest defence deal. The MRCA tender was floated with the idea of filling the gap between its future Light Combat Aircraft and its in-service Sukhoi Su-30MKI air superiority fighter. Dassault Rafale won the competition due to its lower life-cycle cost, which is a combination of cost of acquisition, operating cost over a duration of 40 years and cost of transfer of technology.

Delays in the deals

The negotiations began to shown signs of delay when Dassault began to hear about the warranty for aircraft produced by Hindustan Aeronautics Ltd. India wanted Dassault to ensure the quality of aircraft produced by HAL, which was not accepted by Dassault. Two years later, it was reported that the cost of the deal had escalated to USD 30 billion (Rs 1,86,000 crore), with each aircraft costing over USD 120 million (RS 746 crore). In February 2014, defence minister A. K. Antony said that the procedure of calculation of life-cycle cost was being re-examined and the contract could not be signed in fiscal year 2013-14 due to budgetary constraints. In March 2014, HAL and Dassault signed a work share agreement to manage logistics of license manufacture. After the 2014 Indian general election in April-May, National Democratic Alliance led by Bharatiya Janata Party took control of the government from United Progressive Alliance, led by the Indian National Congress. As disagreements over cost and warranty for aircraft produced by HAL continued, the new defence minister Manohar Parrikar said that Sukhoi Su-30MKI could be acquired as an alternative to Rafale. But Air Chief Marshal Arup Raha disagreed, saying that Su-30MKI and Rafale had different capabilities and one could not replace the other. In February 2015, it was widely reported that the Rafale deal would be cancelled. But the Indian government once again decided to buy Rafale due to the less number of fighers. Prime Minister Narendra Modi intervened and decided to buy 36 ready-to-fly fighters instead of trying to acquire technology from Dassault and make it in India. Consequently, in September 2016, after clearance from the Indian Cabinet Committee on Security, India and France signed an inter-governmental agreement (IGA) for the acquisition of 36 aircraft at a cost of euro 7.87 billion (Rs 58,891 crore) in what was the first fighter aircraft deal for India in 20 years.

Reliance Group and Dassault Aviation Deal

Reliance Group and Dassault Aviation issued a joint statement announcing the creation of a 51:49 joint venture named Dassault Reliance Aerospace Limited (DRAL) in 3 October 2016. The opposition parties accused the government of causing huge loss to taxpayers's money after dealing with Rs 58,000 crores in November 2016. They claimed that the Anil Ambani-led Reliance Defence Limited had been unfairly picked to be the French firm's Indian partner. The Congress alleged that the cost of each aircraft is three times more than what the previous UPA had negotiated with France in 2012.

Conclusion

One of the major allegations by opposition parties, is that why Dassault choose Anil Ambani's company, rather choose other big MNC corporations which have much more experienced and involved in defense manufacturing. One cannot arrive at a conclusion, whether corruption has taken place or not, but there is a clearly signs of favourtism. Besides, many defence experts feel that the government is hiding some information behind the secrecy clause to give out the financial information.



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