India likely to directly buy 63 Rafale combat jets

New Delhi, April 10 , 2015: The Indian government has more or less decided to scrap the medium-multi role combat aircraft (MMRCA) selection process in favour of direct purchase of 63 Rafale aircraft from France in a government-to-government deal, says India Strategic magazine. Authoritative sources told the journal that a MoU would be formally signed in Paris during the summit meeting between Prime Minister Narendra Modi and his host, President Francois Hollande. The number of aircraft is half that the 126 jets the Indian Air Force (IAF) had tendered for, 18 of which were to be acquired direct. The rest will be made by Hindustan Aeronautics Ltd (HAL) in India. There have been serious differences over responsibility for the quality of aircraft to be made by HAL and the overall pricing. Dassault, which produces the Rafale, had said it would do the transfer of technology and invest 50 percent in India as part of the 50 percent offsets clause stipulated in the tender but would not be responsible for what comes out of the HAL production lines. Although Dassault had won the tender on the basis of technical evaluation and its "lowest" bid, the costing after accounting for periodic escalations during the life of the programme was touching $24 billion. This made the ministry of defence uncomfortable. As negotiations with Dassault were not leading anywhere, Defence Minister Manohar Parikkar observed that the deal could not go through if Dassault continued to ask for way too much. Defence ministry sources said it had "bitter experience" with French firm DCNS in the past over pricing while negotiating the Scorpene submarine deal and a decision was becoming difficult.