Narendra Modi and the Rafale Deal and defanging of the Indian Air Force
The IAF had projected a need to induct at least six squadrons to augment the depleting strength of the fighter squadrons of the IAF, due to wear, tear, and accidents. The MIG2, the backbone of the Air Force was becoming obsolete and the air staff projected an immediate induction of first-line interceptors and multi-role aircraft. The requirement was first projected during the term of Atal Bihari Vajpayee in 2003-04.
After technical evaluation which consisted of examining American and Russian front line planes, the dice were cast in favor of the Rafael. This is a French plane and the evaluating team felt this to be the best bet for the IAF. I feel political considerations also played a part and the Indian government rejected comparable aircraft from Russia, a longtime partner, and the USA. The Euro- fighter was considered but the option was exercised for the. Dassault Rafale.
The LOI-letter of intent was issued in 2007 by the UPA government headed by Mr. ManMohan Singh. At that time the deal envisaged was for 126 planes of which 18 were to be bought in flyaway condition and the balance 108 were to be manufactured in India at Hindustan Aeronautics Limited ( HAL) at Bangalore.
Pricing and other factors
The deal struck with Dassault was for each aircraft to be priced at 71 million Euros. The UPA government however meandered on and no worthwhile decision was taken and Dassault informed in 2011 that due to price escalation the plane in flyaway condition would now cost 100 million Euros each.
This was accepted by the UPA government and discussions commenced to seal the deal. But the manufacture of 108 fighters at HAL struck a roadblock as Dassault refused to take warranty and responsibility for the aircraft manufactured at HAL. In addition, the requirement of man-hours by HAL was three times the estimate of Dassault.
The deal remained in limbo and in 2014 the Modi government of the BJP won a majority and formed the government. The NDA government revived the project and Mr. Modi visited France and met the French President Hollande. It was decided that the IAF will buy 36 Rafale fighters in fly-away condition. A preposterous decision was taken to prune the IAF requirement of 126 to a mere 36.
Modi claimed a "discount" of 9% and the bare bones Rafale was nowpricedd at Euro 91 million.
The fact that the Modi government had reduced the requirement from 126 to 36 was attacked by the Opposition. Many opined that security was jeopardized. The NDA government claimed that the government of Modi had got a reduced price for the Rafale. This is, however, a half truth as in effect the development cost, which was spread over 126 planes was now shared by 36 planes and in effect, the plane became 41% more costly. N Ram in an article in the Hindustan Times brought out benchmark price, a sort of ceiling for the whole package, discovered by financial experts was arbitrarily raised from €5.2 billion to €8.2 billion at political behest. this has not been countered by anybody and as usual, Mr. Modi has kept a studious silence and not a word or statement ora press conference has been addressed by him on this issue. He has left his ministers to do the talking and this does raise eyebrows.
As things stand the IAF is planning to induct two Rafale squadrons, one of which will be positioned in Ambala and the other in Hashimara ( north Bengal). There is no doubt just operating two squadrons in place of 7 will severely limit the IAF capability.
The facts as they stand are that despite a requirement projected by the Indian Air Force in 2003 not a single aircraft has landed in India as per last reports. The IAF is severely depleted and the promise to buy 36 planes is in real terms meaningless as the minimum requirement was for 126 planes. Nobody has explained how and why the Modi government reduced the requirement.
Matters are made complicated by the Air Chief coming out openly and backing the Modi government Rafale deal. He failed to explain why the IAF accepted 36 planes deal in place of 126 and in the bargain did his credibility no good.
There is also no explanation why the entire project has escalated by billions while the total number of Rafale is reduced. There is no guarantee that we have heard the last word on l’affaire Rafale.