Contentious issues between the Indian and French governments over the “off-the-shelf” 36 Rafale Multirole Combat Aircraft deal have been resolved to the satisfaction of all parties concerned, and the
Contentious issues between the Indian and French governments over the “off-the-shelf” 36 Rafale Multirole Combat Aircraft deal have been resolved to the satisfaction of all parties concerned, and the inter-governmental agreement (IGA) is likely to be signed very soon, a top government source told this newspaper.
“It is just a matter of a week or two now at most with phrases being tightened up here and there,” the source said adding that the first fighter should land in India after 18 months of the agreement being inked.
A defence ministry official also substantiated the development. “The deal is almost done and is in the final stages, just the finer points of the contract are being worked out,” he said.
On September 1, the defence ministry had cleared the final report that had been prepared by a team negotiating the deal with France. The file has also been perused and reviewed by the PMO.
The government-to-government deal announced during Prime Minister Narendra Modi’s trip to France in April 2015 did not pick up speed it was expected to with issues emerging over price and transfer of technology.
In May, the standing committee on defence in its report to the Lok Sabha had panned the government for the delay in finalising the deal. “Although a considerable time has elapsed, negotiations with France on Rafale could not be taken to a logical end,” it had said.
While the French wanted about Rs 65,000 crore, India is willing to pay about Rs 59,000 crore.
The final deal is also expected to come with the clause of delivering 50 per cent offsets, which France’s Dassault Aviation — the makers of the state-of-the-art fighter — wanted capped at 30 per cent. India seeks a higher offsets figure in order to create jobs and opportunities for smaller Indian companies.
Earlier the government had scrapped a mega deal to procure 126 Rafales as it would have cost about Rs 1.3 lakh crore over a period of 10-11 years. Incurring such expenditures for the fighters would have affected the overall modernisation plan of India’s armed forces.
India is critically short of air fighter squadrons. While at least 43 fighter squadrons are needed in the event of a two-pronged war, the IAF has just about 33 now. Moreover, a significant number are aging and would soon be in the process of being phased out.
