This week, India’s Cabinet Committee on Security (CCS), chaired by Indian Prime Minister Narendra Modi, is set to approve a $9 billion contract for the purchase of 36 fourth generation multirole fighter jets for the Indian Air Force, according to Indian government sources.
A high level delegation of French defense contractors involved in the government-to-government deal for 36 off-the-shelf Dassault Rafale twin-engine, fourth generation multirole fighter aircraft are currently in New Delhi to work out last minute details, The New Indian Express reports.
French aircraft maker Dassault Aviations will manufacture the aircraft, MBDA Missile Systems will supply the weapons package, and Thales Group will be responsible for the fighter jet’s avionics. “Representatives all three involved defense firms are in talks to take swift decision on any last minute doubt. Certainly, the deal is making a headway and should be done in a week’s time,” an unidentified Indian defense official said on September 12.Enjoying this article? Click here to subscribe for full access. Just $5 a month.
There was some speculation that the CCS could approve the deal today. This, however, does not appear to have been the case. One of the reasons for the delay has been France’s insistence that a government-to-government contract should be signed prior to the conclusion of a 50 percent offset deal.
“According to the offset deal, France will invest 30 percent into military aeronautics-related research programs and 20 percent into local production of Rafale components. French defense contractors have also agreed to supply radar and thrust vectoring for missiles technologies, among other things,” I explained previously (See: “India-France Fighter Jet Deal Faces Further Delays”).
Further points of contention were the delivery date of the aircraft—the first Rafale warplanes are slated to be delivered roughly 18 months after the signing of the final contract—and technical issues. “The Indian Air Force wanted a customized version of the aircraft including modifications and reconfigurations to allow the installation of Indian-made and commercial-off-the-shelf systems and weapons,” I reported earlier in the year.
As I explained previously (See: “Confirmed: India to Buy Only 36 Rafale Fighter Jets”):
Initially, the MMRCA [medium multi-role combat aircraft] project envisioned that India’s Hindustan Aeronautics Limited (HAL) would build 108 out of a 126 total Rafale jets locally, with the first batch of 18 fighter jets directly delivered from France in flyaway condition.
However, New Delhi unexpectedly announced in April of this year that it would only purchase 36 French-made Rafale fighters instead of the original 126…
The price tag for the 36 off-the-shelf Rafale will substantially be cheaper since France is no longer obligated to build the planes in India.
According to a senior defense official interviewed by the Hindustan Times, “the cost of 36 fighters will be around Rs 7000-8,000 crore lower than that what was being offered to the previous UPA regime in the now canceled contract for multi-role medium range combat aircraft (MMRCA).” India’s defense minister, Manohar Parrikar, has been insisting on a 10-20 percent price reduction. While no official price has been announced, the Indian Defense Ministry’s Defense Acquisition Council (DAC), headed by Parrikar, approved the deal in August indicating that the disagreement over the price has been resolved. It is now up to the Prime Minister’s Office to give the final go-ahead.