On July 20, 2018, during the debate in the Parliament in the wake of the “No Confidence Motion” moved against the NDA government by the opposition spearheaded by the Congress Party, there was an ugly slugfest between the two major political entities over the deal with the Government of France for 36 Rafale jets, a product from Dassault Aviation. There is even a privilege motion against Prime Minister Narendra Modi and Defence Minister Nirmala Sitharaman for allegedly misleading the House by not revealing the financial details of the deal.

The deal for 36 Rafale jets for the Indian Air Force (IAF) was initiated by Prime Minister Narendra Modi during his visit to France in April 2015. There was direct interaction between Prime Minister Modi and Francois Hollande the then President of France. This initiative by Prime Minister Modi was driven primarily by the fact that the tender for 126 medium multirole combat aircraft (MMRCA) floated in August 2007 during the UPA regime for which the nuclear-capable Rafale had been identified as the preferred platform, had run aground due to certain insurmountable impediments. The MMRCA tender had incorporated the ‘Make in India’ scheme with Hindustan Aeronautics Limited (HAL) designated as the lead integrator. 18 aircraft were to be procured in fly-away condition from Dassault Aviation and the remaining 108 were to be manufactured in India by HAL with transfer of technology (ToT).

At the time the tender for 126 MMRCA was floated, the IAF was already afflicted with serious erosion of the combat capability of its fleet of fighter aircraft, a large part of which had been overtaken by obsolescence and was thus heading for retirement from service. The problem was further aggravated by the unfortunate cancellation of the tender for 126 MMRCA pushing the IAF into a distress situation especially as it is required to be prepared to cope with offensive air operations launched by China and Pakistan simultaneously. Cancellation of the MMRCA tender thus generated serious concerns about the lack of operational capability of the IAF to fight a two-front war. It was at this juncture that Prime Minister Modi made good use of his visit to France and negotiated the Rafale deal that has become a subject of political controversy today. As the number being acquired was much too small for a manufacturing facility to be set up in India, the 36 Rafale jets are to be procured in fly-away condition. This acquisition would provide relief to the combat fleet of the IAF, albeit only partially.

The most contentious issue raised by the opposition in the Parliament was about the cost which was claimed to be negotiated in the MMRCA tender during the UPA regime as being under 600 crore per aircraft whereas the NDA government has finalised a deal shelling out 1600 crore per aircraft, an escalation by nearly 300 per cent! Unfortunately, as claimed by the Minister of Defence, the NDA government was not in a position to reveal details of the contract including pricing on account of a secrecy pact with France pertaining to procurement of military hardware entered into in 2008 during the UPA regime. Unfortunately, the opposition concluded that the NDA government “had something to hide” and hinted at a strong possibility of a “scam”, something that has in fact hounded successive Congress governments in several major projects, both within and outside the domain of the Ministry of Defence, beginning with the infamous Bofors scam.

As the 126 MMRCA tender encountered a road-block after technical evaluation of all six platforms in the race, the final word on the cost of the deal could not be said. The figure of 600 crore per aircraft in the MMRCA tender as quoted by the opposition, was the price of only the aircraft whereas, 1600 crore per aircraft finalised by the NDA government, includes cost of advanced avionics, a range of the latest weapon systems, maintenance and spares support through its life cycle and training. The IAF projected a number of additions, modifications and assets to keep the Rafale jet relevant as a front-line combat platform for at least four decades after induction. As the MMRCA tender had stopped well short of the contract negotiations stage, the final price was not quoted. There is therefore no basis for comparison of price in the MMRCA tender and direct purchase of 36 aircraft through government-to-government transaction. Any attempt to do so would not be in order as it would only be misleading.

As for the allegation of exclusion of HAL from the project, unlike in the MMRCA tender, in this case, the aircraft will be manufactured in France and as such HAL really has no role. As for investments under Offset, a number of private and public sector companies in India will benefit. Unfortunately, the political debate to discredit the Government continues unabated and this could lead to cancellation of the deal that would seriously impinge on the operational capability of the IAF. Whatever be the final outcome, the public debate certainly reflects a disturbing lack of concern for national security among some sections of the political establishment.