India, France to iron out hitches, expedite deal for Rafale jets

India, France to iron out hitches, expedite deal for Rafale jets

With the big-budget purchase for 126 fighter jets in limbo for the last three years, India and France on Monday decided to “resolve every differences in a fast-track manner” to formalise the mega defence deal at the earliest.

The decision was taken at a delegation-level talk between French Defence Minister Jean-Yves Le Drian and his Indian counterpart Manohar Parrikar here on Monday, sources told Deccan Herald.

The meeting had been rescheduled to the evening as the French minister arrived in India late, which led to cancellation of the planned guard of honour in front of South Block.

Almost three years ago, India had shortlisted Dassault Aviation's Rafale fighter jet as the preferred platform to replace the Indian Air Force's ageing MiG-21 fighter jets. The deal to procure 126 aircraft, however, has not been inked even after three years of protracted negotiations.

“Where there are still differences, efforts would be made by both sides to resolve the issues in a fast-track manner,” said sources.

As per the original plan, Dassault was to deliver 18 aircraft in fly-away condition while Hindustan Aeronautics Ltd (HAL) would manufacture the rest under licensed production.

Though the tender was valued at $10.4 billion (Rs 42,000 crore), the price is likely to escalate to $17-20 billion in the final commercial contract, making it India's biggest defence deal.

The main issue stalling the deal is responsibility for the aircraft made at HAL, as the French firm has said it could not guarantee what HAL produced. The last 60 planes are slated to have 90 per cent Indian content.

“Of course Rafael is there on the agenda. Its up to the two companies (Dassault and HAL) to do it. Our minister wants to meet the new defence minister of India,” French ambassador Francois Richier had said last week.

The two sides also decided to take forward the 1998 strategic partnership between New Delhi and Paris. 

Other issues discussed at the meeting included the opportunity for the French defence industry to invest in India in the wake of the NDA government's Make in India campaign, and Indian Ocean-region security.

Before attending the talk, the French minister, who will be here for three days, also met members of the Vivekananda Foundation for a closed-door discussion.

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