2016-01-09 By Guishan Luthra
Authoritative sources told India Strategic that documents for the Government-to-Government (G-to-G) deal were delivered by New Delhi to Paris on New Year’s Eve, and that the agreement is on the same lines as that for the Mirage 2000 aircraft signed in the early 1980s.
IAF will buy all the Rafale aircraft from Dassault, the French aircraft builder and integrator, in a flyaway condition.
As the deal is G-to-G, the French Government will ensure that Dassault complies with the terms of reference, as of course it has successfully done in the case of Mirage 2000, about 60 of which were delivered beginning 1985. The basic agreement was for 49 and 10 more were acquired later.
Significantly, this is the second deal for IAF – and Indian Army – within one week, the other being for Russian Kamov-226T helicopters signed on Christmas Eve in Moscow during Prime Minister Narendra Modi’s visit there with the Russian Government. That deal of course involves substantial manufacture of these machines in India as the number is large, more than 200.
Notably, Defence Minister Manohar Parrikar has said in an interview published in the December edition of India Strategic that the Government had cleared deals worth about $15 billion (Rs 90,000 crore) , and it appears that these two deals are covered in this figure. But it is not confirmed as details of the deals were not disclosed in the interview, conducted by leading Defence analyst Brig Gurmeet Kanwal, who is a member of this publication’s Editorial Board.
It may also be noted that originally. IAF was to acquire 126 aircraft after the Rafale was selected in the MMRCA competition some time back, 18 in flyaway condition and 108 as progressively assembled and made in India by HAL under part Transfer of Technology (ToT). Private industry was to be involved but HAL’s share was negotiated as more than 70 per cent.
There were a lot of hiccups, over costs of the aircraft – over $100 million-plus per aircraft – and offsets from the Indian side and responsibility over the quality of production in India from the French side.
Finally, keeping in mind IAF’s urgent requirements, Mr. Modi intervened to order 36 aircraft, or two squadrons, in a direct G-to-G deal during his visit to Paris in April.
This time, the deal involved no production in India but there were still some hiccups over the 50 per cent stipulated offsets although aircraft costs would by and large have been the same as for the French Air Force (Armée de l’Air). Offset obligations would always be additional.
Mr. Modi intervened again, spoke directly with French President Francois Hollande on telephone early September, and expressed difficulty in doing the deal without the offsets. Mr. Hollande graciously agreed, and IAF approved the deal mid-December.
The Ministry of Defence (MoD) delivered a copy of the Inter Government Agreement in this regard through the established diplomatic channels just as the New Year was set to begin.
The deal would be part of the minutes on growing Indo-French cooperation when President Hollande visits India as the Guest of Honor on India’s Republic Day on January 26.
Under the deal, Dassault and its main partners, engine maker Safran and electronic systems maker Thales, will share some technology with DRDO (Defence Research and Development Organisation) and maybe some private sector companies and HAL under the offsets clause.
Details are not known, but as the aircraft have to be flown and maintained in India for at least three to four decades, a lot of information and technology upgrades will be needed to keep them operational.
The twin-engine Rafale combat jet is designed from the beginning as a multi role fighter for air-to-air and air-to-ground attacks, is nuclear capable and, thanks to its onboard Electronic Warfare (EW) systems, can also perform SIGINT and radar jamming roles.
It may be noted that Chief of the Air Staff, Air Chief Marshal Arup Raha, had told India Strategic in a recent interview that he expected the deal to be closed by year-end. MoD has done just that, giving a New Year Gift to both the IAF and France.
The deal involves delivery of aircraft to begin within three years of signing the agreement – 2018-end in this case – but French industry sources told this writer some time back in Paris that Dassault had started planning for the Indian order from mid-2015 itself, and “maybe the deliveries could be faster if required.”
2015 has been lucky for Dassault as the Rafale has also been selected by Egypt and Qatar, while the UAE is considering it seriously. There are suddenly too many orders, and the only way to meet them is to divert the French Air Force requirements for the next few years. That is being done.
Republished with permission of our partner India Strategic.
The photos in the slideshow highlight the Rafale in the recent Trilateral Exercise held at Langley AFB and the photos are credited to the USAF.