What is Rafale Deal? – All you need to know about it

What is Rafale Deal? – Understanding the controversy

India in September 2016 inked a direct deal with the French government to purchase 36 new Rafale fighter jets in a 7.87-billion-euro deal.

Fighter-Jet-Rafale

Photo Credit- NDTV

India also had to get latest weapons like the Meteor and Scalp missiles as part of the contract, besides a five-year support package that assures high availability of the fighter.

India needed to pay a 15% advance and deliveries are to start in three years.

The deal was initially estimated to be worth Rs 54,000 crore. This deal is called as Rafale Deal.

When was the deal signed?

The Rafale deal was initiated in 2012 by UPA or United Progressive Alliance or in short, the congress government initially. However, the deal was being negotiated and remained incomplete due to cost issue and RFP compliance. Therefore, there was ‘no Rafale-deal’ under the UPA Government.

 The negotiations were eventually done by the ruling party BJP or Bhartiya Janta Party (also known as NDA) in September 2016, which won the Indian Lok Sabha election in 2014 and came to the power.

Why Rafale is important to India?

The Rafale deal was important for both sides- India and France. However, for India the deal was not only for business but for creating work in Indian Private Sector under ‘make-in-India’ Programme. 

The combat aircraft strength of Indian Air force has come down, and India needed aircrafts for defence capabilities as well. 

Many international aviation manufactures expressed interest when they got know about the Indian government's plan to revamp its IAF fleet by introducing Multi-Role Combat Aircrafts.

IAF conducted technical and flight evaluations and in 2011, declared that Rafale and Eurofighter Typhoon had met its criteria. 

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Rafale was declared L-1 bidder in 2012 and contract negotiations began with its manufacturer, Dassault Aviation, that year. Contract negotiations remained incomplete even after 2 years, in 2014 due to a lack of agreement on various terms of RFP compliance and cost related issues. There was no deal under the UPA Government.

Therefore, the Rafale deal stood for both economically and defence purpose.

Who were the parties of Rafale Deal?

Rafale fighter jets are made by Dassault, the French aircraft builder and integrator.

The deal initiated in 2012, and it was decided by then Indian government that Rafale would be introduced in air force. 

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Originally, India wanted to buy 18 off the shelf jets from France’s Dassault Aviation, and 108 would be assembled in India by HAL or Hindustan Aeronautics Limited.  This was negotiated during 2012 and under UPA regime.

What has triggered the Rafale- Controversy?

The Modi – Led BJP Government changed the commitment and said that twin engine planes would be too expensive and there were a lot of problems related to the cost of the aircraft.

Prime Minister Narendra Modi decided to buy 36 ready to fly aircraft and denied acquiring technology from Dassault.  As a result, assembling it in India programme cancelled.

The opposition, Congress party accused BJP for non- transparency, and one after another the controversy makes the head lines since November 2016.

The Congress party even accused the BJP that the cost of an aircraft is three times higher than previous deal which was negotiated with France in 2012.

The Congress party also claimed that the Anil Ambani led Reliance Defence Limited has been unfairly picked choice of French’s firm’s partner.

Further, the congress continued to attack the government for irregularities.

The BJP or NDA (National Democratic Alliance) government has insisted that it got significantly better terms than those quoted in the original bid under UPA.

The BJP said that the deal saved more than 1600 million Euros (350 million Euros on the cost of aircraft with a further reported saving on weapons, allied maintenance and training package amounting to an around 1300 million Euros or Rs 12,600 crores).

However, a cost breakdown of Rafale in the original bid under UPA and in the 36 aircraft in the government-to-government deal under NDA are not in the public domain.

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There was no ‘technology transfer previously’ but ‘Licence Manufacturing Technology’

There was no agreement on the terms of Technology Transfer previously. What was on offer was just Licence Manufacturing technology.

Under the current agreement, the 36 Rafale procurement offset proposal supports the 'Make in India' initiative of the Indian Government through Article 12 of the IGA.

It states that the French Party will facilitate the implementation of 'Make In India' by the industrial supplier notably through offsets for 50% value of the supply protocol.

India has managed to negotiate the acquisition of the latest weapons package for the Rafale. These are the new weapons, beyond the standard package.

What is Rafale?

Rafale is a twin-engine medium multi-role combat aircraft, manufactured by French company Dassault Aviation. Dassault claims Rafale has 'Omnirole' capability to perform several actions at the same time, such as firing air-to-air missiles at a very low altitude, air-to-ground, and interceptions during the same sortie.

The aircraft is fitted with an on-board oxygen generation system (OBOGS) which suppresses the need for liquid oxygen re-filling or ground support for oxygen production.

It carry out a wide range of missions: Air-defence/air-superiority, Reconnaissance, close air support dynamic targeting, Air-to-ground precision strike/interdiction, anti-ship attacks, nuclear deterrence, buddy-buddy refueling.

Transfer of Technology remained the primary issue of concern between the two sides. Dassault Aviation was also not willing to take the responsibility of quality control of production of 108 aircraft in India. While Dassault provisioned for 3 crore man hours for production of the aircraft in India, HAL's estimate was nearly 3 times higher, escalating costs manifold.

The Supreme Court of India in Rafale Deal

The Indian government has not provided information related to Rafale  in public domain. Therefore, a petition was submitted in Supreme Court, and it alleged that the government supressed the vital information and circumstances of Rafale Jets.

Initially, on December 14, 2018,  in the judgment in the Rafale case, the court found no “substantial material on record to show that this is a case of commercial favouritism to any party by the Indian Government, as the option to choose the IOP does not rest with the Indian Government.”

However, in April 10, 2019, The Supreme Court decided to hear the review petitions on Rafale fighter aircraft deals on the basis of published documents in media.

Indian government raised an objection, and the objection was dismissed by the Chief Justice of India Ranjan Gogoi in April.

The government said that national security was at stake as these documents were very confidential in nature. These documents were protected under the Official Secrets Acts (OSA) of 1923.

However, the judiciary said that Right to Information Act 2005 has revolutionised the governance and overpowered the notion of secrecy protected under the Official Secrets Acts (OSA) of 1923. 

The Controversy again started when court said in April 2019, that government should not more time and disclose the documents. As a result the Indian government submitted 13 page reply. The government kept a side where government has accused the petitioner for creating controversies on the basis of media reports.

The government affidavit was filled by Ministry of Defence. According to Affidavit there were certain explanations:-

Ø  The decision was taken by the Cabinet Committee on Security (CCS). The CCS is the highest decision making body in the government on defence. The decision was also supported by the Defence Acquisition Council (DAC), that again is the highest decision-making body in Ministry of Defence. 

Ø  Actions of Petitioner seem tantamount to questioning the sovereign decision concerning national security and defence. 

Ø  The issue reported in the media relates to the decision of a sovereign Government giving certain concessions to the subsidiary of an Indian private entity in a sector unrelated to Defence. It is far-fetched and a figment of imagination to link the decision of the French Government in this case to the procurement of 36 Rafale Aircraft.

Ø  All files, notings, letters, etc., related to the procurement, including the full pricing details, have been made available to the Comptroller and Auditor General (CAG), who had given a report concluding that the price of 36 Rafales was 2.86% lower than the Audit’s aligned price, apart from additional benefits that would accrue because of change from firm and fixed pricing to non-firm price.

Ø  The affidavit explained that the CAG, a constitutional body, after examining extensively the process of procurement of 126 MMRCA, had clearly stated in its audit report that in the case of 126 MMRCA, the procurement that started in 2000 had made no progress even after 15 years had lapsed and, in fact, failed on the two-fold issue of calculating the manpower costs of producing the aircraft in India and non-guarantee of aircraft by M/s Dassault Aviation, the OEM, for aircraft to be licence-manufactured by M/s HAL in India.

Ø  A series of reports by The Hindu revealed that the PMO was conducting “parallel negotiations” with the French for the off-the-shelf purchase of 36 Rafale jets manufactured by Dassault Aviation even as the Indian Negotiation Team was having detailed talks with its French counterpart.

Ø  In affidavit it was said that it was attempting to bring out internal processing of this Government-to-Government procurement and trying to present a selective and incomplete picture of the same.

The Centre misled and played fraud upon the apex court to obtain favourable order in the Rafale fighter jet case in December 2018, former Union Ministers Yashwant Sinha and Arun Shourie and activist-lawyer Prashant Bhushan claimed in the Supreme Court on May 9.

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