By Ajai Shukla
Business Standard, 8th February 18
In a written statement on Wednesday, the defence ministry rebutted what it calls “unfounded allegations” and “misleading statements” on the 2016 agreement between New Delhi and Paris to buy 36 fully built Rafale fighters.
The statement does not offer any figures about how much India is paying for the various components of the deal – a key demand of the political opposition. Defence Minister Nirmala Sitharaman had promised on November 17 to provide the figures, but on Monday declined to do so, citing a “confidentiality agreement” signed with France.
The ministry statement indicated today that supplying details would reveal the Rafale’s capabilities, compromising operational secrecy.
“The approximate acquisition cost of the Rafale aircraft has already been provided to the Parliament. Provision of exact item-wise cost and other information will reveal, inter alia, details regarding the various customizations and weapons systems specially designed to augment the effectiveness and lethality of the assets, impact our military preparedness and compromise our national security,” said the ministry.
It said this was in line with “the confidentiality provisions of a bilateral India-France Agreement of 2008 signed by the previous [United Progressive Alliance] government.”
Indicating that this was normal government practice, the ministry stated: “In keeping with confidentiality requirements, the UPA Government had also expressed its inability to disclose the price of various defence procurements, including in its responses to Parliament Questions (sic).”
This contention is not backed by facts. When the UPA government faced a question in Parliament on March 4, 2013 on the purchase and upgrade cost of the Mirage 2000 from Dassault, it tabled a detailed answer.
“The last contracted price for each Mirage 2000 aircraft in the year 2000 was Rs 133 crore. The contract for the upgrade was signed in 2011, wherein, the cost of upgrading one aircraft was Rs 165 crore”, the UPA government answered, adding further details.
Furthermore, top MoD officials have already revealed exact details of the contract, including a cost breakdown, in an off-the-record briefing on September 24, 2016 – the day the Rafale IGI and commercial contracts were signed.
As this newspaper reported that day (September 24, 2016, “India signs Euro 7.8 billion deal for 36 Rafale fighters; no options for more”) the average cost of each Rafale is Euro 91.7 million (Rs 726 crore at current exchange rates). In addition to the Euro 3.3 billion cost of 36 Rafale fighters, India contracted to pay Euro 4.5 billion more for: “India-specific enhancements” (Euro 1.7 billion); spares (Euro 1.8 billion), logistics (Euro 350 million) and weaponry (Euro 700 million), according to the MoD officials.
The NDA government has never confirmed these figures, but can do so now without revealing operational details of the “India specific enhancements”.
Next, the defence ministry addressed the question of why Eurofighter was not invited to bid for 36 fighters, to make it a competitive procurement, rather than presenting Dassault with an advantageous single-vendor situation.
“It (the Congress Party) seems to have been conveniently forgotten that the [UPA] Government itself had rejected [Eurofighter’s] unsolicited offer made days after closure of the bid process, declared [Dassault] as the [lowest] bidder and had commenced negotiations with it in February 2012”, said the ministry statement.
While this is factually correct, the UPA government was prevented by the Defence Procurement Procedure (DPP) from entertained Eurofighter’s unsolicited offer once Dassault had been declared the lowest bidder. However, there was no DPP restriction on asking Eurofighter to bid for supplying 36 fighters, since that was an entirely new procurement.
Finally, the defence ministry release stressed that the purchase of 36 Rafales was “strictly in accordance with the Defence Procurement Procedure in all aspects including mandating, conducting and monitoring of negotiations and seeking all necessary approvals, including that of the Cabinet Committee on Security, before entering into the IGA.”
This is factually correct. However, the DPP-mandated process had not been gone through when Prime Minister Narendra Modi announced the agreement on April 10, 2015, on a visit to Paris.
“I have asked President (Francois Hollande) to supply 36 ready-to-fly Rafale jets to India,” said Modi at a press conference, effectively sealing the deal.
Eager to dispel any hint of wrongdoing, the defence ministry came out punching today, stating: “the deal secured by the [NDA] Government is better in terms of capability, price, equipment, delivery, maintenance, training, etc., than that notionally negotiated by the then [UPA] Government in a process it could not conclude in ten years. Moreover, the present Government completed these negotiations in just about one year.