HAL can’t escape from its responsibilities, says MoD

The Defence Ministry on Thursday said HAL couldn’t escape from the responsibilities of not being able to conclude a commercial contract with Dassault Aviation to licence-manufacture 126 Rafale fighter jets at the state-owned aircraft manufacturer’s factory.

Defence ministry sources contradicted former Hindustan Aeronautics Limited chief T Suvarna Raju, who in an interview blamed the ministry for not being able to close the deal after years of protracted negotiations.

Officials said HAL itself flagged the disagreement areas to the MoD several times since 2012, because of which the deal couldn’t be concluded.

After it came to power in 2014, Narendra Modi-led NDA government inked the Rs 59,000 crore contract with France to buy 36 Rafale jets in a fly away condition. The deal triggered a major political row with the Congress and other critics accusing the Modi government of paying more to France and favouring Anil Ambani-led Reliance Defence at the cost of HAL.

The row was further fuelled by Raju, who claimed HAL could have manufactured the French jets, had the Defence Ministry signed the deal, absolving the defence PSU of responsibilities for the logjam that ultimately scuttled the previous deal. Raju was HAL’s Chairman-cum-Managing Director till August-end.

Defence ministry officials contradicted such a claim. They said Raju was a member of the Contract Negotiation Committee (for the 126 fighter deal) and there were major areas of disagreement between HAL and Dassault.

In October 2012, HAL wrote to the MoD bringing out the disagreement pertaining to the work share between HAL and the French vendor. In July 2014 – two months after Modi government came to power – HAL flagged one major unresolved issue regarding responsibility sharing between HAL and Dassault Aviation.

Further, the man-hours required for the manufacture of various components of the aircraft in HAL was also a point of disagreement between the two parties, sources said. Due to these reasons the proposal for the 126 medium multi-role combat aircraft couldn’t be progressed.

The MMRCA tender was cancelled by former defence minister Manohar Parrikar in July 2015, three months after Modi made the controversial announcement to buy 36 Rafale.

“The statements made by the former CMD (in the interview) are incorrect as there are clear contradictions,” sources said.