Published On: Tue, Nov 13th, 2018

Rafale deal in conformity with 2013 Defence Procurement Procedure: Centre to SC

New Delhi: The Centre has defended the deal to procure 36 Rafale fighter jets in a fly-away condition and asserted that the purchase of the French fighter aircraft was in conformity with the process laid down in the Defence Procurement Procedure of 2013.

The offset contract does not envisage manufacture of 36 Rafale aircraft in India by any public or private sector firm

“It is reiterated that that the procurement process as laid down in the Defence Procurement Procedure (DPP)-2013 was followed in procurement of 36 Rafale aircraft. The approval of DAC (Defence Acquisition Council) for procurement of 36 Rafale aircraft was taken, Indian Negotiating Team (INT) was constituted which conducted negotiations with the French side for about a year and approval of CCS (Cabinet Committee on Security) being CFA (competent financial authority) was taken before the signing of IGA (inter-government agreement),” the Centre has said.

On the contentious issue of HAL being dislodged as an Indian Offset Partner, the Centre has contended that in the IGA between India and France there was no mention of any private business entity.

“In so far as discharging the offset obligations by OEM and its Tier-I vendors through Indian Offset Partners (IOPs) is concerned, there is no mention of any private India business house(s) in IGA or Offset Contract,” the Centre told the top court.

“The offset contract does not envisage manufacture of 36 Rafale aircraft in India by any public or private sector firm,” the government has said.

Washing its hands of any involvement in the choice of private player as Offset Partner by Dassault Aviation, the Centre has said that it was entirely up to the French aircraft manufacturer to decide.

“As per the Offset Contract, the vendor/OEM is required to confirm the details of the IOPs/products either at the time of seeking offset credits or one year prior to discharge of offset obligations,” the Centre said.

“The vendor/OEM is yet to submit a formal proposal in a prescribed manner indicating details of IOPs and products for offset discharge”, which is likely to happen only in 2019.

Amongst the papers given to the top court, the Centre has also included the statement issued by the Press Information Bureau (PIB) by way of clarification on former French President Francois Hollande’s interview concerning the selection of Reliance Defence as the offset partner.

On September 22, the Defence Ministry issued a clarification on the offset guidelines, saying, “As per Defence Offset Guidelines, the foreign Original Equipment Manufacturer (OEM) is free to select any Indian company as its offset partner.”

It described the JV between Reliance Defence and Dassault Aviation as a “purely commercial arrangement between two private companies”.

The Centre has cited security considerations to justify the aborting of the earlier process for the procurement of 126 jet fighters (18 in fly-away condition and 108 to be manufactured in India), and opting to purchase 36 Rafale aircraft instead, contending that,”During this long period of inconclusive 126 MMRCA process, our adversaries inducted modern aircraft and upgraded their older versions.

“Further,” the government said, “They (adversaries) modernised and inducted aircraft with advance weapon and radar capabilities. As per available information, our adversaries inducted more than 400 fighters (equivalent to more than 20 Squadrons) during the period from 2010 to 2015.”

“They not only inducted 4th Generation aircraft but also inducted 5th Generation Stealth Fighter Aircraft” and the “combined effect of our own reducing combat potential and our adversaries’ enhancing their combat potential made the situation asymmetrical and extremely critical”.

Thus, the government said that an “urgent need was felt to arrest the decline in the number of fighter squadrons in the IAF and enhance their combat capabilities.”

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