Delay in talks pushed Rafale prices up, Centre tells SC

Delay in talks pushed Rafale prices up, Centre tells SC

The Apex court had also asked the Centre to place before it in a sealed cover within 10 days the pricing details of 36 Rafale fighter jets India is buying from France.

The Centre has told the Supreme Court that more than three years of delay in finalising the contract for buying Rafale fighter jets as well as euro-rupee exchange variations resulted in the price escalation of the equipment sought to be procured for the Indian Air Force.

The documents — supplied by the Union government to a number of PIL petitioners who alleged corruption in the Rafale deal with France — maintained that it “completely followed” the Defence Procurement Procedure (DPP) guidelines 2013 for obtaining 36 aircraft.


The petitioners included former Union ministers Yashwant Sinha, Arun Shourie and advocate Prashant Bhushan. Two other advocates, M L Sharma and Vivek Dhanda, had filed separate petitions. AAP MP Sanjay Singh had also filed another PIL in the matter.

“All the requisite steps... have been followed. The approval of DAC (Defence Acquisition Council) was taken. An Indian negotiating team was constituted which conducted negotiations with the French side for about a year and the approval of CCS (Cabinet Committee on Security), being the CFA (Competent Financial Authority), was taken before signing the IGA (Inter-Governmental Agreement),” it said.

Since 2002, over 1,100 crore contracts valued at Rs 7.45 lakh crore were successfully concluded using the DPP structure, introduced after the Kargil war.

The Rafale deal, as well as its pricing details, were questioned by the main opposition Congress party to attack the central government for buying the aircraft for a higher price.

In its response to the apex court’s October 31 order to provide details of the process for offset obligations, the Union government said it was again as per the DPP guidelines 2013.

It said two offset contracts were signed — one with M/s Dassault Aviation and another with M/s MBDA on September 23, 2016, the same day on which the Indian and the French governments signed the agreement for procurement of 36 Rafale aircraft.

With regard to the earlier bids to acquire 126 aircraft on August 28, 2007, the Centre said the contract negotiations could not conclude, mainly due to unresolved issues related to the 108 aircraft to be manufactured in India. “These issues pertained to lack of common understanding between Dassault and HAL. The manhours that would be required to produce the aircraft in India: HAL required 2.7 times higher manhours compared to the French side for the manufacture of Rafale in India,” it said.

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