The much-awaited Indian Dassault Rafale fighter jet deal with France has moved a step closer to inking, with the defence ministry finalizing...
Rising costs and Dassault's reluctance to transfer critical engine and radar technology has been a major hurdle to seal the deal. The deal will be finalised by the year.
The cost has skyrocketed so much that,when the tender was floated in 2007 the cost was estimated at $12 billion and when the lowest bidder Rafale was announced in January 2012, the cost has reached $18 billion. The latest estimates puts the deal at $20 billion.
Indian Air Force with a dwindling fighter fleet is desperate to induct Rafale as soon as possible to maintain the combat edge in the perceived two front war with China and Pakistan. IAF with a sanctioned strength of 45 fighter jet squadrons, however, has only 34 squadrons operational. The 126 Rafale fighter deal will replace the obsolete and crash prone 12 strong squadron of Mig-21s in the fleet.
The core of IAF's frontline fighter fleet is the Sukhoi Su-30 MKI supplemented by Mirage-2000 jets.
France and Dassault is also desperate to clinch the deal as, lossing the deal will shut the Rafale production line and will effect the future of its aerospace sector. Moreover with Rafale yet to clinch any foreign orders, the deal will also help to win more export orders as well as decrease the production cost.
The tender for procurement of 126 Medium Multi-Role Combat Aircraft (MMRCA) was issued to six vendors – Russia’s MIG-35(RAC MiG); Swedish JAS-39 (Gripen);Dassault Rafale (France); American F-16 Falcon (Lockheed Martin); Boeing’s F/A-18 Super Hornet and Eurofighter Typhoon (Made by Eurofighter consortium of British, German, Spanish and Italian firms).
Under the terms of purchase, the first 18 aircraft will come in a ‘fly away’ condition while the remaining 108 will be manufactured under Transfer of Technology by Hindustan Aeronautics Ltd. The vendor finally selected would also be required to undertake 50% offset obligations in India.
Dassault refused to take responsibility for the 108 HAL-manufactured Rafales, as it had reservations about the ability of HAL to accommodate the complex manufacturing and technology transfers of the aircraft, which further delayed the deal.
The ToT and offset contracts would provide a great technological and economic boost to the Indian indigenous defence industries.
Despite being expensive and an aggressive counter campaign by the Europeans, the Indian side is firm about wrapping up the Rafale deal.
