Cannot compare Rafale deal with 126 MMRCA proposal, says Nirmala Sitharaman

The cost of 36 Rafale jets, being procured from France, cannot be "directly compared" with the original proposal to buy 126 combat aircraft during the UPA government as "deliverables" were significantly different in the two cases, Defence Minister Nirmala Sitharaman said on Monday.

Replying to questions relating to the Rafale deal in Rajya Sabha, she also said that EADS, the consortium of four European aviation companies, had submitted "unsolicited offers on November 14, 2011 and July 5, 2014, after opening of the commercial bids for the procurement".

The then UPA government had floated a tender in 2007 for purchase of 126 medium multi-role combat aircraft (MMRCA) for the Indian Air Force and, post negotiations, Dassault Aviation's Rafale and and EADS's Eurofighter Typhoon -- remained in the reckoning. However, the deal could not be finalised by the UPA regime.

"M/s DA (Dassault Aviation) was determined as L1 (lowest bidder) based on Total Cost of Acquisition (TCA). The cost of 36 Rafale aircraft cannot be directly compared to the cost of original 126 MMRCA proposal as deliverables are significantly different," Sitharaman said.

The defence minister did not give a direct reply to a question on whether the costs under the Dassault Aviation's response to the RFP (request for proposal) were reconsidered in 2015 or at any other time.

She also did not respond to another query by MP Rajeev Gowda on whether life-cycle cost under the Eurofighter-Typhoon RFP was lower than Dassault Aviation's "RFP costs" in 2015.

"M/s EADS had submitted unsolicited offers on November 14, 2011 and July 5,2014. The unsolicited offers of M/s EADS were received prior to withdrawal of RFP on June 24, 2015," she said.

The Congress has been attacking the government over the Rafale issue, claiming that the deal negotiated under its rule was much cheaper then the contract signed by the Modi government to procure 36 Rafale fighter jets from France at a cost of Rs 58,000 crore.

India had inked an inter-governmental agreement with France in September 2016 for procurement of 36 Rafale fighter jets at a cost of around Rs 58,000 crore, nearly one-and-a-half years after Prime Minister Narendra Modi announced the proposal during a visit to Paris.

The delivery of the jets is scheduled to begin from September 2019.The Congress has also been demanding details of the deal, including per aircraft price, but the government has refused to share them, citing confidentiality provisions of a 2008 Indo-France pact.

Alleging corruption, the Congress has been asking the government 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 negotiated price of USD 241.66 Million (Rs 1,570.8 crore) for the 36 jets.

Official sources claimed the original deal to procure 126 fighter jet could not go through during the UPA rule despite reaching the final stage due to an intervention by the then defence minister A K Antony as he felt something wrong in the process.

They said the government selected Rafale for procurement of the 36 fighter jets not because of the price arrived at during the UPA tenure but due to the "overarching" assessment of the jet.

The Congress had also claimed that Qatar had purchased 12 Rafale fighter jets in November 2017 for USD 108.33 million per aircraft (Rs 694.80 crore), noting that the per aircraft rate at which the Gulf nation was buying the jet was much lower than the rate at which India would procure them.