Rafale Scam set to explode in India! Deal in trouble?

BawliBooch · Wed Feb 07, 2018 3:21 am

The 58000 crore deal in 2016 for Rafale Jets is set to cause a political storm across the coming week.

The Defense Minister, Ms. Nirmala Sitaraman refused on Thursday to share commercial details on the revised deal with Parliament saying it was confidential - a stand that is untenable according to the Indian constitution.

Centre cannot disclose details of Rafale deal as it is classified, says defence minister

Background:
6 aircraft manufacturers competed for the bid for 126 aircraft MMRCA project: Lockheed Martin’s F-16s, Boeing’s F/A-18s, Eurofighter Typhoon, Russia’s MiG-35, Sweden’s Saab’s Gripen and Dassault Rafale. All aircraft went extensive trials between 2007 & 2012 and Dassault was declared the winner. The initial deal was for 126 aircraft for $10.2 billion (54000 crores), of which 18 aircraft were to made in France and the remaining in India by public sector aircraft manufacturer HAL - Hindustan Aeronautics.

The deal was scrapped by the new govt that took charge in India in May 2014 and the contest was reopened. In Aug 2016, Anil Ambani owned Reliance Defense signed a contract with Dassault and within 30 days of this announcement, the PM Modi made a surprise announcement in Paris on the deal to buy 36 Rafales in a "fly away" condition for $8.7 billion with Reliance doing local support instead of HAL and no local manufacture.

The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

alberchico · Wed Feb 07, 2018 3:39 am

If India wants the best bang for their buck they should scrap the Dassault deal and buy the Mig-35. The Navy already operates the carrier capable variant so they already have some first hand experience of how good the aircraft is.

Ozair · Wed Feb 07, 2018 5:03 am

BawliBooch wrote:
The 58000 crore deal in 2016 for Rafale Jets is set to cause a political storm across the coming week.

The Defense Minister, Ms. Nirmala Sitaraman refused on Thursday to share commercial details on the revised deal with Parliament saying it was confidential - a stand that is untenable according to the Indian constitution.

The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

I saw this report this morning and am interested to see how this plays out. The whole MMRCA has been a mess for a while now and when India and France went sole source outside the contract guidelines there was always a chance it was going to blow up in their faces.

I am certainly interested to see the actual cost breakdown of the purchase as there have been mulitple numbers thrown around regarding the acquisition price of Rafale.

alberchico wrote:
If India wants the best bang for their buck they should scrap the Dassault deal and buy the Mig-35. The Navy already operates the carrier capable variant so they already have some first hand experience of how good the aircraft is.

Not much chance of that, the MiG-35 was an offering in the original contest but was eliminated early on. The Indian Air Force has zero interest in commonality with Naval aircraft and additionally the Air Force acquisition of Rafale has essentially zero relevance to the Indian Navy pursuit of a new carrier aircraft, which is favouring the Rafale and SH over the MiG-35 anyway.

BawliBooch · Wed Feb 07, 2018 7:46 am

Ozair wrote:
I am certainly interested to see the actual cost breakdown of the purchase as there have been mulitple numbers thrown around regarding the acquisition price of Rafale.

That is exactly the question that the opposition MP had for the Govt. But the minister in charge of defense, Nirmala Sitharaman has done a complete U-turn on the question of costing. When she took charge of the ministry, she had in a Press Conference promised to reveal the commercial details of the deal with Rafale to the public. But now the official position is that even Parliament cannot be told of the commercials in the deal because of confidentiality clauses - which is complete BS. While secret clauses in deals can be kept away from the public, Parliamentary Committees have the constitutional right to get this information. Atleast for now, we are still a Parliamentary Democracy.

There are also questions on why Public sector HAL was kept out of the deal and overnight Dassault was given a deal in haste just 2 weeks after Dassault signed up with Reliance Defense (owned by Anil Ambani - a known crony of PM Modi).

Then there are questions on who changed the IAF spec's for the remaining 90 aircraft which will now be single-engined! The Air Force has denied making any such changes but the Defense Minister (former) claims the AF changed the specs for the remaining aircraft. What on earth is going on?

I am disappointed in Ms.Sitharaman. She is an alumni from my own college and senior by few years. She had NOTHING to do with this deal - someone else was Defense Minister when this deal was signed, but even he was kept out of the deal. But she is certainly denting her credibility by defending the PM in what is clearly a case of crony corruption. I personally think she should do what VP Singh did in the 80's when the Bofors scam broke. Expose the corruption in the deal and resign from govt.

st21 · Wed Feb 07, 2018 9:15 am

alberchico wrote:
If India wants the best bang for their buck they should scrap the Dassault deal and buy the Mig-35. The Navy already operates the carrier capable variant so they already have some first hand experience of how good the aircraft is.

Indian Navy is unhappy with its MiG-29Ks last i heard. They have poor reliability and many defects. The fact that the type isnt even considered anymore by the Indian Navy in its new RFP is telling...

Aesma · Wed Feb 07, 2018 10:12 am

Either they want aircraft soonish, or they want cheap aircraft, or they want home made aircraft. I'm not even sure you can fill two of those conditions together, let alone three.

Ozair · Wed Feb 07, 2018 9:37 pm

BawliBooch wrote:
That is exactly the question that the opposition MP had for the Govt. But the minister in charge of defense, Nirmala Sitharaman has done a complete U-turn on the question of costing. When she took charge of the ministry, she had in a Press Conference promised to reveal the commercial details of the deal with Rafale to the public. But now the official position is that even Parliament cannot be told of the commercials in the deal because of confidentiality clauses - which is complete BS. While secret clauses in deals can be kept away from the public, Parliamentary Committees have the constitutional right to get this information. At least for now, we are still a Parliamentary Democracy.

So I came across this article http://www.business-standard.com/articl ... 970_1.html last night that indicated the costings for Rafale and seems legit and within expected ranges.

As this newspaper reported that day (September 24, 2016, “India signs Euro 7.8 billion deal for 36 Rafale fighters; no options for more”) the average cost of each Rafale is Euro 91.7 million (Rs 7.2 billion at current exchange rates). In addition to the Euro 3.3 billion cost of 36Rafale fighters, India contracted to pay Euro 4.5 billion more for: “India-specific enhancements” (Euro 1.7 billion); spares (Euro 1.8 billion), logistics (Euro 350 million) and weaponry (Euro 700 million), according to the MoD officials.

BawliBooch wrote:
There are also questions on why Public sector HAL was kept out of the deal and overnight Dassault was given a deal in haste just 2 weeks after Dassault signed up with Reliance Defense (owned by Anil Ambani - a known crony of PM Modi).

HAL was a sticking point in the MMRCA though and Dassault was looking for the local partner they could work with, no surprise that Ambani raised his hand.

BawliBooch wrote:
Then there are questions on who changed the IAF spec's for the remaining 90 aircraft which will now be single-engined! The Air Force has denied making any such changes but the Defense Minister (former) claims the AF changed the specs for the remaining aircraft. What on earth is going on?

Isn’t that a whole separate deal that essentially makes up for the lack of 126 aircraft for the MMRCA and the tacit acknowledgement that Tejes will not meet requirements?

BawliBooch · Thu Feb 08, 2018 12:34 am

So Dassault had a problem with HAL (supposedly). But it was upto the Indian Govt to set the terms & conditions. They allowed Dassault to decide who the Indian partner would be? And how convenient that the Indian partner chosen was Anil Ambani - a crony of the current regime with ZERO experience in manufacture of aircraft or defense systems. As compared to HAL with over 70 years of experience in the field?

Earlier the deal included Tech Transfer - major consideration in choosing the Rafale in the first place. Now it doesnt? Can companies change the terms of engagement after winning a contract? What gives?

If the deal is legit and clean, why use the excuse of "confidentiality clauses" and hide it from Parliament?

I can understand if all details of defense deals cannot be disclosed to the public. But Parliament has the right to know these things. Its about accountability.

The latest statement from the Govt, they have repeated the same line. Price is legit, but details cannot be disclosed to Parliament.

What is the Govt hiding?

angad84 · Thu Feb 08, 2018 5:01 pm

BawliBooch wrote:
The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

They were never going to get 126 of any jet for ~$11bn. There's no scam, just stupid people trying to score political points. And I can assure you that plenty of people knew about the Rafale deal before the announcement was made, primarily because I was one of them.

BawliBooch · Sat Feb 10, 2018 12:47 am

angad84 wrote:
They were never going to get 126 of any jet for ~$11bn. There's no scam, just stupid people trying to score political points. And I can assure you that plenty of people knew about the Rafale deal before the announcement was made, primarily because I was one of them.

Why was the earlier deal arbitrarily put on hold? Why was the new deal rushed through in such hurry by the PMO directly without even taking the Defense Minister or Air Force chief into confidence? One cannot wish away the scam by saying there was "no way we were going to get 126 jets for ~10.2bn". If everything is so open-ended and transparent, why is the Govt so cagey about revealing the financials to Parliament?

Confidentiality clauses can prevent the govt from making some details public. But Parliament has a right to know. The fact that some bhakt journalists loyal to the govt may have access to the financials doesnt make it transparent. Govt has a duty to answer to Parliament. What is behind Modi's stubborn refusal to do so?

If zone5aviation can be supplied with the information despite the confidentiality clause, then surely Parliament can be trusted?

This is not going to go away.

BawliBooch · Sat Feb 10, 2018 12:56 am

Details of the deal have indeed been leaked and are available to the opposition now. A European newspaper is hot on the trail of the story now. Any journalist who sticks their neck out to defend the Govt on the Rafale Scam is going to end up with their credibility destroyed for good. Chitra Subramaniam for one.

This is NOT going away!

BawliBooch · Sat Feb 10, 2018 1:32 am

Opposition has smelt blood, going in for the kill!

With 6 questions, the opposition has nailed "Jaitlie" on the Rafale deal.

Surjewala wanted to know whether the per aircraft price of Rafale, according to international bids opened on December 12, 2012, comes to USD 80.95 million (Rs 526.1 crore) as against the Modi government’s per aircraft negotiated price of USD 241.66 Million (Rs.1,570.8 crore), as per current exchange rates.

He also asked whether Qatar had purchased 12 Rafale fighter jets in November 2017 for USD 108.33 million per aircraft (Rs 694.80 crore), according to current exchange rates. “If this is correct, why has the Modi government paid such an astronomically higher price for the Rafale aircrafts?” According to Surjewala, Rafale and Eurofighter Typhoon aircrafts were found equal on all technical requirements by the Indian Air Force.

The big worry now is with the Govt decisively cornered on corruption, there is a real fear that Modi & his party will go back to their time honored tactic for situations like these - trigger communal riots and use the polarization to escape! We are already seeing signs of that on the ground with comments from the likes of Vinay Katiyar.

BDQ2DXB · Sat Feb 10, 2018 4:24 am

Rahul seems to have picked his topic-of-the-month... Unfortunately the opposition rarely researches its talking points.

I think it would help to read up on facts before discussing:

https://www.newslaundry.com/2018/02/09/rafale-deal-misconceptions-defence-ministry-dassault

As far as crony capitalism concerned :

5) The government bypassed HAL - an experienced aerospace manufacturer - and “gave the deal” to Reliance Defence Limited (RDL) instead.

The only company the government “gave the deal” to was Dassault. HAL had to be “bypassed” because the idea of local manufacturing was dropped entirely.

RDL’s involvement in this story is only tangential. People often assume that just because Anil Ambani signed a joint venture with Dassault, his company is going to build Rafale aircraft in India. The reality is that there was an offset clause in the Rafale contract, and Dassault decided to tie up with Reliance to execute a small part of it.

A majority of the offsets shall go to the Defence Research and Development Organisation (DRDO). RDL has no plans of building anything related to the Rafale. It will manufacture parts for a civilian aircraft and become a part of Dassault’s global supply chain.

BarfBag · Sat Feb 10, 2018 8:37 am

Here we go again. Booch running around like a headless chicken after his favorite nemesis - Narendra Modi.

a stand that is untenable according to the Indian constitution.

Quote the article and specific lines from the constitution associated with this then :stirthepot:

Anyone claiming "UPA negotiated Rs.54,000 crore for 126 Rafales and NDA is spending Rs.58000 crore on JUST 36 Rafales!" has no idea what they're babbling. Hint: the UPA negotiated nothing to conclusion. Just do the math - 126 Rafales for Rs.54000 crore i.e. approx Rs.430 crore per plane - $67 million each. Go ahead and propose that to the French. See what you get.

Aesma · Sat Feb 10, 2018 2:48 pm

I really don't know the details but you can't compare the deal with Qatar, who already operates Dassault jets, already has compatible weapons, pilots that only need additional training, etc. I'm sure Qatar will also spend additional money on maintenance, spares etc. over time.

Dutchy · Sat Feb 10, 2018 3:58 pm

Deals are notoriously hard to compare because you have to know what is included in the final offer and what's not, and even then.

India does operate Dassault jets though, Mirage 2000: 36 single-seat Mirage 2000Hs and 4 twin-seat Mirage 2000TH (1982 order) & 8 singles and 1 twin-seat (1986 order) & 10 (2004 order):

Should still be about 50 in their inventory, all to be ungraded to Mirage 2000I/TI standard.

angad84 · Sat Feb 10, 2018 7:51 pm

BarfBag wrote:
Anyone claiming "UPA negotiated Rs.54,000 crore for 126 Rafales and NDA is spending Rs.58000 crore on JUST 36 Rafales!" has no idea what they're babbling. Hint: the UPA negotiated nothing to conclusion. Just do the math - 126 Rafales for Rs.54000 crore i.e. approx Rs.430 crore per plane - $67 million each. Go ahead and propose that to the French. See what you get.

Yep.

Aesma wrote:
I really don't know the details but you can't compare the deal with Qatar, who already operates Dassault jets, already has compatible weapons, pilots that only need additional training, etc. I'm sure Qatar will also spend additional money on maintenance, spares etc. over time.

India also operates Dassault jets (more than Qatar). The reason you cannot compare is because the deals are different. Things like training, MILCON, weapons packages, customer-specific customisation, will always make it difficult to nail down a quality comparison.

Dutchy wrote:
Deals are notoriously hard to compare because you have to know what is included in the final offer and what's not, and even then.

India does operate Dassault jets though, Mirage 2000: 36 single-seat Mirage 2000Hs and 4 twin-seat Mirage 2000TH (1982 order) & 8 singles and 1 twin-seat (1986 order) & 10 (2004 order):

Should still be about 50 in their inventory, all to be ungraded to Mirage 2000I/TI standard.

Indeed, and the upgrades have begun, with many already complete.

Cheers

aviationaware · Sat Feb 10, 2018 9:14 pm

BawliBooch wrote:
The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

The only scam that happened I assume was the Indian politicians trying to convince anyone that they'd get a modern fighter aircraft for 80 million dollars a piece.
The 230 million of the second deal are much closer to the ballpark.

Dutchy · Sat Feb 10, 2018 9:16 pm

aviationaware wrote:
BawliBooch wrote:
The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

The only scam that happened I assume was the Indian politicians trying to convince anyone that they'd get a modern fighter aircraft for 80 million dollars a piece.
The 230 million of the second deal are much closer to the ballpark.

80m for sec the fighter, without engines, support, weapons, spare parts, training etc. etc. etc. etc. etc. etc. sounds doable.

There are of course some fixed cost to be paid, no matter how many a/c are purchased, so less a/c more per a/c.

BawliBooch · Sun Feb 11, 2018 2:19 am

aviationaware wrote:
The only scam that happened I assume was the Indian politicians trying to convince anyone that they'd get a modern fighter aircraft for 80 million dollars a piece.
The 230 million of the second deal are much closer to the ballpark.

The original deal was for 126 fighters, of which only 18 were to be built in France by Dassault and the remaining in India under license by state owned aircraft manufacturer Hindustan Aeronautics (HAL). That deal was scrapped by the current govt when it came to power. The original deal also included tech-transfer.

The crux of the matter here is that the current PM overnight signed a new deal for just 36 jets in a fly-away configuration, with no local manufacture, without any tech-transfer and the local partner being replaced - by Reliance Defense owned by Anil Ambani - a known crony of the current PM.

If the deal is above board and transparent as the Govt insists, then what stops it from answering the questions raised in Parliament? Confidentiality clauses cannot be extended to Parliament which has the right to ask these questions. Indeed, the BJP in opposition did ask for and receive answers on defense deals when they were in opposition.

Ozair · Sun Feb 11, 2018 1:55 pm

BarfBag wrote:

Anyone claiming "UPA negotiated Rs.54,000 crore for 126 Rafales and NDA is spending Rs.58000 crore on JUST 36 Rafales!" has no idea what they're babbling. Hint: the UPA negotiated nothing to conclusion. Just do the math - 126 Rafales for Rs.54000 crore i.e. approx Rs.430 crore per plane - $67 million each. Go ahead and propose that to the French. See what you get.

I think an offer that low from the French is perfectly possible.

Put the order in context, it is 2012 and the Rafale has yet to make a single export sale, despite being developed on the prospect of export of hundreds of aircraft. France/Dassault are getting desperate and the lure of a large order from India, which at that time equalled the entire production run of Rafale to date, would have been a driving factor in offered a very low price. Only after India declared Rafale L1 and went to negotiate the deal did they see the lack of detail in certain specific areas and an older version offered than expected with little Indian customization.

angad84 · Sun Feb 11, 2018 9:35 pm

Ozair wrote:
I think an offer that low from the French is perfectly possible.

Except it didn't happen. The figure there is not a bid value, it's the amount that the MoD allocated as an indicative budget approval in advance of the tender, waaaaay back in 2006 (called Acceptance of Necessity (AON), in local parlance). It was unrealistic then, it only got more unrealistic as the process dragged on. Neither of the two qualifying bids was even remotely close to that number. I can't find my notes for per unit pricing, but in mid-2015 I was told the actual number being negotiated with Dassault was right around $30 billion, which was something like double of the bid that had led to the L1 declaration in Jan 2012. The original Eurofighter consortium bid was significantly lower (in the region of $20bn), given that they had submitted a more comprehensive (some would say more honest) bid than Dassault. The latter basically caveated all its pricing, leading to the headbutts once negotiations began. The Indian MoD is used to getting discounts after bid opening, not escalations!

BawliBooch · Mon Feb 12, 2018 3:04 am

angad84 wrote:
Except it didn't happen. The figure there is not a bid value, it's the amount that the MoD allocated as an indicative budget approval in advance of the tender, waaaaay back in 2006 (called Acceptance of Necessity (AON), in local parlance).

THAT is simply not true. If that is what journalists on the BJP's chai-pakoda briefings are being told, then its a lie that can most easily be smashed.

There was indeed a formal agreement on price between the countries, back when there was a different govt in charge and "St.Anthony" was Minister of Defense.

The convoluted justifications being offered by "chai-pakoda" journalists loyal to this corrupt regime still dont explain why the Modi govt refuses to share details with Parliament as they are supposed to - AFTER they promised to do so last year. They also cannot explain the switch from HAL to Reliance Defense. Or the switch from local manufacture to full import.

According to my sources, 2 European news agencies are now hot on the trail of this explosive story. And its BIG! What the Indian media cannot or will not do, the western media will!

I am reminded of the time when the Bofors scam broke - I was fresh out of college then and an unpaid intern. Many loyal Indian journalists tried to mount a defense of Rajiv Gandhi govt much like some journalists are attempting today. It all went to waste when a Swedish newspaper & radio broke the story! EXPLOSIVE! And just like in 1987, a lot of these chai-pakoda journalists are going to end up with egg on their faces and destroyed careers.

BDQ2DXB · Mon Feb 12, 2018 6:46 am

LoL this guy is hilarious!.
Hint: Why not quote specific facts that support your point rather than running around like a headless chicken.

Thanks for entertaining us though! Appreciate it

angad84 · Mon Feb 12, 2018 12:03 pm

Yeah this is getting silly, I'm bowing out.

BawliBooch · Tue Feb 13, 2018 1:30 am

BDQ2DXB wrote:
LoL this guy is hilarious!.
Hint: Why not quote specific facts that support your point rather than running around like a headless chicken.

Thanks for entertaining us though! Appreciate it

The point is clear if you want to see it BDQ2DXB.

Why is the govt hiding the "specific facts" from Parliament? If the deal is indeed as transparent and clean as they claim it is, why this obfuscation? Parliament has a right to know and the govt is hiding behind its troll armies who are running around like headless chickens.

YuriMG2 · Tue Feb 13, 2018 2:01 am

BawliBooch wrote:
The crux of the scam - 126 jets for $10.2 billion in 2014 and now $8.7 billion for 36 jets. In addition, parliamentary committees and even the service chiefs had no idea of the Rafale deal till the announcement was made.

Idk whats more insane: To think you can buy 126 Rafales for 10.2b or end up buying 36 for 8.7.

Lol

BawliBooch · Tue Feb 13, 2018 2:22 am

YuriMG2 wrote:
BawliBooch wrote:
Idk whats more insane: To think you can buy 126 Rafales for 10.2b or end up buying 36 for 8.7.

Lol

$10.2bn doesnt sound too insane considering 108 of them were to be built in India by state firm HAL.

There is good reason the current govt is obfuscating on the issue and denying discussion in Parliament. If it is a clean deal, why would they need to hide it from Parliament?

BawliBooch · Tue Feb 13, 2018 2:58 am

RAFALE EXPOSE: With half-truths, Defence Minister lands herself and PM Modi in deeper trouble

Fair use excerpt:

The topic, over the next two months, was placed in the back-burner till it was raised in the Rajya Sabha by congress MP Prof Rajeev Gowda during the ongoing budget session of the parliament.

Gowda asked for the details of the penalty imposed on Dassault for refusing to fulfill the contractual obligations, cost per air craft under the inter-government agreement signed by this government for 36 Rafale jets and whether the cost difference is due to the inclusion of a private player instead of HAL. Sitharaman’s answer in the parliament was very interesting, to term it politely.

The first answer reads “there was no contract with Dassault for the Medium Multi Role Combat Aircraft”. Technically this argument is correct because the RFP was cancelled by this government before signing the contract. But the pertinent question that remained unanswered by Sitharaman was why they cancelled the RFP when the negotiations were 95% complete? Dassault CEO, Eric Trappier, confirmed this in front of the Indian High Commissioner to France, senior IAF officials and French journalists in a press conference. When Eric Trappier was getting ready to visit India in two weeks, the Indian PM announced his decision to go for an off-the-shelf purchase of 36 aircrafts, that too in almost two weeks. (Eric Trappier’s press conference was on 25 March 2015 and Modi’s announcement from Paris was on 10 April 2015).

Sitharaman’s second answer in the parliament reads that she cannot disclose the details of the price at which the Modi government signed the contract due to a certain clause in the “Agreement between The Government of the Republic of India and The Government of the French Republic concerning the Protection of Classified Information and Material in the field of Defence”.

Really? Let’s read what that agreement, signed between India and France in 2008, stated. The said agreement read, “For any contract or sub-contracting contract that includes classified information and material, a security annex shall be drawn up. In this annex, the competent security authority from the Party forwarding the information or the material, shall specify what has to be protected by the Receiving Party, as well as the corresponding classification level, applicable to it.”

For a moment, let us assume that the above mentioned agreement was renewed (though there’s no information of that available in public domain). But, it raises a more fundamental question. In a democracy, how can the defence minister hide the financial details of a big transaction from the exchequer in the guise of a secrecy agreement? That argument itself raises more questions thereby giving more credence to the clouds of suspicion surrounding the Rafale deal.

BawliBooch · Tue Feb 13, 2018 3:02 am

Apart from 2 european media agencies, some brave Indian journalists are standing up to investigate the Rafale Scam. The online portal JantaKaReporter and newspaper "The Wire" are leading from the front.

Rafale Deal Expose II: Clinching evidence that may cause political earthquake in India

BawliBooch · Sun Mar 11, 2018 4:21 am

French President Macron is visiting India this week, hoping to increase the order book by another 36 Rafales at the same inflated rate.

Meanwhile, this year's financial report by @Dassault_OnAir pretty much demolishes the Modi government's `secrecy clause' lie for hiding #Rafale deal pricing from the Indian Parliament.

2017 ANNUAL FINANCIAL REPORT

Cost/aircraft paid by Qatar : Rs. 1319.80 crores.
Cost/aircraft paid by India : Rs. 1670.70 crores.

Difference (for 36 aircrafts): Rs. 12632 crores.

This is for the new deal with all 36 aircraft in flyaway condition.

As per old deal, cost/aircraft for 126 aircraft was to be ~Rs.630 crores with 18 aircraft built in France and the remaining 108 built in India by HAL.

So any way you look at it, looks like India overpaid for this hurried deal signed overnight by PMO without consulting defense acquisition committees or the cabinet.

Latest Govt line being spun is purchase was made on "emergency basis", yet not a single aircraft delivered in 36 months!

I think the Indian Govt should now hold Dassault & France accountable for making them look like fools. They should not have released the pricing data publicly and embrassed the Govt.

Dutchy · Sun Mar 11, 2018 9:36 am

BawliBooch wrote:
I think the Indian Govt should now hold Dassault & France accountable for making them look like fools. They should not have released the pricing data publicly and embrassed the Govt.

That is a funny comment. Sue someone because he makes you look bad.....

Phosphorus · Sun Mar 11, 2018 10:34 am

Dutchy wrote:
BawliBooch wrote:
I think the Indian Govt should now hold Dassault & France accountable for making them look like fools. They should not have released the pricing data publicly and embrassed the Govt.

That is a funny comment. Sue someone because he makes you look bad.....

Funny or not, the basic question is rather: is Dassault obliged to release those figures to shareholders, under French laws on reporting for public corporations (S.A.)? If yes, then discussion is over.
If legal counsel of the Indian Government failed to realize the basic fact -- that they buy from a listed company, that has to report things, then too bad.

BawliBooch · Sun Mar 11, 2018 11:25 am

Dutchy wrote:
BawliBooch wrote:
I think the Indian Govt should now hold Dassault & France accountable for making them look like fools. They should not have released the pricing data publicly and embrassed the Govt.

That is a funny comment. Sue someone because he makes you look bad.....

That was meant in sarcasm. The Indian Govt has tied itself in knots first promising to, then backtracking by claiming that it could not reveal the pricing details to Parliament because of a confidentiality clause which was untrue. With Dassault revealing the pricing details indirectly, this puts the Govt position in question.

unrave · Sun Mar 11, 2018 2:40 pm

We were promised a political earthquake with the Rafale expose, looks like this is the only forum that is still interested in discussing this 'scam'.

BawliBooch · Mon Mar 12, 2018 5:28 am

It is being discussed in Parliament. And yes a section of the Media is picking it up.

Some may chose to sweep the scam under the carpet for political reasons. But that wont make it go away.

Olddog · Mon Mar 12, 2018 7:54 am

So Macron was in India. Did you ask him about Rafale's costs?

Dutchy · Mon Mar 12, 2018 11:53 am

BawliBooch wrote:
It is being discussed in Parliament. And yes a section of the Media is picking it up.

Some may chose to sweep the scam under the carpet for political reasons. But that wont make it go away.

You frame it as a scam, but is there any real way to know?

BawliBooch · Tue Mar 13, 2018 1:32 am

Dutchy wrote:
You frame it as a scam, but is there any real way to know?

Prima-facie it appears to be a scam based on the pricing details we already know. Dassault's annual report only confirms the Govt was lying. The Govt's cagey behavior since the scam broke only confirms the suspicions.

The Govt should clarify in Parliament and release the details to the Parliamentary committee which is empowered to look into Defense deals. Why has the govt been so reluctant to share details with Parliament?

Phosphorus · Tue Mar 13, 2018 6:50 am

BawliBooch wrote:
Dutchy wrote:
You frame it as a scam, but is there any real way to know?

Prima-facie it appears to be a scam based on the pricing details we already know.

What criteria do you expect this story to meet, for this to be a scam? (just the fact that Customer A paid more than Customer B doesn't cut it as a proof of a scam -- customers buy different configuration and spare parts stores with their purchases; some customers get discounts for being a pleasure to deal with -- while others should be charged more, as they cost too much to sell too).

Dutchy · Tue Mar 13, 2018 7:40 am

Phosphorus wrote:
BawliBooch wrote:
Dutchy wrote:
You frame it as a scam, but is there any real way to know?

Prima-facie it appears to be a scam based on the pricing details we already know.

What criteria do you expect this story to meet, for this to be a scam? (just the fact that Customer A paid more than Customer B doesn't cut it as a proof of a scam -- customers buy different configuration and spare parts stores with their purchases; some customers get discounts for being a pleasure to deal with -- while others should be charged more, as they cost too much to sell too).

Exactly, I would argue that it is very difficult to prove anything just looking at an annual report. I understand the "entertainment" value of it, but that's about it.

blrsea · Tue Mar 13, 2018 10:44 am

Aircraft license produced to be built in India has actually cost more than procuring it directly from the vendor. That is because one has to pay licensing fee (royalty), set up the factory in India, purchase all the equipment, cost of some of raw material from parent country itself etc. It has been the case for SU-30MKI that India produced too.

Home-made Sukhois to cost more than ones bought from Russia

Same thing was observed with T-90 tanks manufactured in India.

India has paid for India-specific enhancements to the tune of $1.7 billion Euro, so no surprise that the per aircraft price for Indian Rafale is more than that of Qatar.

That website janatakareporter.com is a website run by a politician from AAP. They come up with weird claims from time to time, no surprises there.

BawliBooch · Tue Mar 13, 2018 11:58 pm

So why does the Govt keep hiding behind lies? If there is nothing to hide, reveal the details to Parliament. The French President has already busted the lie about commercial details being confidential.

No point shooting the messenger! And its not like its just janatakareporter that is reporting on the Rafale Scam. The key question is this: what stops the Govt from ending the speculation and providing the details to empowered Parliament committee? What is it hiding?

scbriml · Wed Mar 14, 2018 8:50 am

BawliBooch wrote:
No point shooting the messenger!

You "broke" this story a month ago. Why hasn't it 'exploded' the way you said it would? Maybe it really is nothing other than normal Indian politics?

Spiderguy252 · Wed Mar 14, 2018 4:31 pm

unrave wrote:
We were promised a political earthquake with the Rafale expose, looks like this is the only forum that is still interested in discussing this 'scam'.

scbriml wrote:
BawliBooch wrote:
No point shooting the messenger!

You "broke" this story a month ago. Why hasn't it 'exploded' the way you said it would? Maybe it really is nothing other than normal Indian politics?

This thread is a microcosm of the Congress and Rahul Gandhi in general: zero show, zero substance.

unrave · Wed Mar 14, 2018 4:40 pm

I guess the 'journalist' mistook Anet for whatever Indian media organisation he works for that would lap up any click baitey material without questioning.

BawliBooch · Thu Mar 15, 2018 12:35 am

I am surprised the real question of why the Govt lied about confidentiality clauses and why they refuse to provide the pricing details to Parliament is being conveniently overlooked.

Then again not surprising. Perhaps it isnt corruption if the Govt gets away with it.

Ozair · Thu Mar 15, 2018 1:37 am

Details have been released on the offset component of the deal Rafale deal. Worth clicking the link to see the slides provided by the Government on where offset work is going.

1st Full Details Of Rafale’s €4-billion Make-in-India & Offsets Plan

As a political storm intensifies around India’s €7.87 billion deal for 36 Rafale fighter jets from France, and substantial fire focused through allegations of preferential corporate partnerships for the €4 billion in offsets that Dassault Aviation and its partners need to execute, the Narendra Modi government today pushed out more information by way of an answer in Parliament.

The answer not only republished cost figures, with the important disclaimer that these figures didn’t take into account the cost of India-specific modifications, weapons and other services, but also cleared the air on allegations over whether India’s apex Cabinet Committee on Security was in the loop on the Rafale deal.

But as the government prepares to fight off in Parliament what appears to be a dogged opposition attack on the deal, Livefist has obtained access to the first comprehensive details of France’s plans on what will easily be the most challenging component of the Rafale deal: the offsets. Offsets involve investments and sourcing that companies manufacturing the Rafale must make in India amounting to half of the deal’s €7.87 billion value. The offsets are to be executed within seven years from the time the deal was signed — by 2023, that is.

In a series of slides accessed by Livefist, the contours of the ‘Make in India’ elements of the Rafale deal stand revealed for the first time. The details that follow pertain principally to the Rafale platform itself, and doesn’t include the $1-billion partnership between France’s SAFRAN and India’s DRDO for the Kaveri turbofan engine, a major thrust area for both countries that will also count in the offsets program.

The details below reveal that Rafale has so far forged partnerships with at least 72 firms for industrial sourcing areas that span, among other Dassault platforms, the Rafale’s airframe, its Snecma M88 engines, radar, electronic warfare and avionics, aeronautical components, engineering and software. The slides below indicate that Dassault and its partners are in negotiations with tens more firms for offsets opportunities. This, in effect, is the first specific and overall sense of what Indian firms will bring to the table on the Rafale.

This first overview of an offsets execution plan is especially of interest, given that India’s offsets policies are widely regarded by international vendors and governments as convoluted, self-defeating, or, in the words of one prominent CEO, “a godawful mess”.

https://www.livefistdefence.com/2018/03 ... -plan.html

Pyrex · Thu Mar 15, 2018 2:25 am

Comparing the cost of planes purchased by Qatar to India is ridiculous. In addition to everything already mentioned, in Qatar, some dictator wakes up some day, feels like he wants some shiny new toys and just buys them (and still throws some at his Egyptian friends, for good measure) - the deal is never in question. In India, in contrast, every single step is frought with endless hassles, as this saga shows. On top of that, there is the whole fallacy of the "offsets" - all that means is that any manufacturer will just increase the cost of anything they sell so they can afford to spend half of it (or more, sometimes) buying subpar crap they don't really need from politically-favored local manufacturers.

BawliBooch · Fri Mar 16, 2018 1:16 am

Pyrex wrote:
Comparing the cost of planes purchased by Qatar to India is ridiculous. In addition to everything already mentioned, in Qatar, some dictator wakes up some day, feels like he wants some shiny new toys and just buys them (and still throws some at his Egyptian friends, for good measure) - the deal is never in question. In India, in contrast, every single step is frought with endless hassles, as this saga shows. On top of that, there is the whole fallacy of the "offsets" - all that means is that any manufacturer will just increase the cost of anything they sell so they can afford to spend half of it (or more, sometimes) buying subpar crap they don't really need from politically-favored local manufacturers.

You are right. Things are not supposed to work that way in a democracy like India. However that is exactly what transpired. One fine day, Modi wakes up and signs a deal previously cancelled by his own govt without informing Parliament, his own cabinet or even the Defense Acquisition groups! The comparison with Qatar was done by the Modi govt itself while announcing proudly that we got a better deal than Qatar while refusing to divulge details. Now as Dassault's annual report shows, the govt was lying.

In a democracy, Parliaments have the right to ask questions. The Govt has been dilly dallying and making up excuses to prevent the figures from coming out. And they have yet to explain why state owned HAL with 70 years experience was kept out of the deal while a complete newbie, Reliance Defense owned by the PM's crony was given the deal.

They have to answer to the people or face the consequences. With a new govt expected to come in in 2019, I hope Dassault Aviation is not blacklisted like the unfortunate Bofors was 2 decades back. It remains in Dassault's interests to go public with the pricing details and reveal the names of the individuals who negotiated the deal and received the kickbacks. Instead of going to Swedish journalists with the information like they are doing, Dassault should know there are many brave journalists in India who would gladly do the story!

Who is online

Popular Searches On Airliners.net