22 September 2018
Prime Minister Narendra Modi had announced in April 2015, that India would buy 36 French-manufactured Rafale fighter jets off-the-shelf from Dassault, the French aircraft builder and integrator. Rafale was chosen in 2012 over those from the United States, Europe and Russia. The purchase was to upgrade India’s ageing fleet.
Original plan by the then UPA government to buy 18 jets from France’s Dassault Aviation, with 108 others to be assembled in India by the state-run Hindustan Aeronautics Limited or HAL in Bengaluru.
After BJP came to power, Modi led government decided to scrap the deal saying that the planes were too expensive.
All of a sudden Prime Minister Narendra Modi intervened and decided to buy 36 off the shelf fighters instead of trying to acquire technology from Dassault and to make them in India. Modi reached a deal at 7.8 billion Euros of which France would invest 30% in India for the local manufacture and related research program. The price of one aircraft went up from $81m to $250m. This is a staggering increase.
French journal Mediapart quoted Francois Hollande as saying: “We did not have a say in this… the Indian government proposed this service group and Dassault negotiated with (Anil) Ambani group. We did not have a choice; we took the partner who was given to us.”
On the side-lines, a recent report surfaced revealing that Ambani, on his visit in 2016, to Paris when the deal was first discussed, agreed to partially finance a movie starring Hollande’s girlfriend, actor Julie Gayet; suggesting a possible conflict of interest. The former French leader denied any conflict of interest with Reliance Group.
It is not clear why Holland is dropping a bombshell now, after keeping quiet for so long. Even if India had indicated preference for Alliance, Dassault Aviation should have done their own investigations to satisfy themselves that their partner was capable of performing the contract.
French government will now have to investigate any violation of foreign corrupt practice law in the Rafale deal.
Defence Minister Nirmala Sitharaman said that the planes now negotiated are better than those negotiated by the UPA government. She also said that Reliance Aerostructure and Dassault Aviation formed a joint venture after a bilateral agreement between two private companies and the Indian government had no role to play in this.
The opposition parties and others are accusing Modi of corruption for higher purchase price and the choice of Reliance of Anil Ambani while leaving out established players like state-run Hindustan Aeronautics Limited or HAL and other private companies such as L&T, Tatas and Mahindra.
Prime minister has not yet made any comments on the accusations levelled against him. The Government has said that it had no role in the selection of Reliance Defence as the Offset partner and that it was purely a commercial arrangement between two private companies.
Advocate M L Sharma filed a petition under PIL (Public interest litigation), requesting seeking a stay on the Rafale fighter jet deal between India and France.
The petition has also sought lodging of a FIR and prosecution of Prime Minister Narendra Modi, former defence Minister and present Goa Chief Minister Manohar Parrikar, business tycoon Anil Ambani and French armament firm Dassault, along with recovery of the amount. The hearing was adjourned till 10 October 2018.
Congress leader Tehseen S Poonawalla also filed a similar petition. Poonawalla, is the brother-in-law of Robert Vadra who is the son-in-law of and Sonia Gandhi.
There were previous scandals concerning AgustaWestland purchases during Sonia Gandhi’s premiership in 2016. In the 1980s during Bofors Scam involving a bid to provide India with 155 mm field howitzers.
