Rafale deal: The real reason why HAL was not picked as offset partner
New Delhi, Nov 13: The Centre told the Supreme Court that the state owned Hindustan Aeronautics Ltd (HAL) failed to become an offset partner in the Rafale deal as there were several unresolved issues it had with Dassault, the French company.
The government claimed that the issues pertained to lack of common understanding between HAL and Dassault Aviation.
"The contract negotiations could not conclude mainly due to unresolved issues related to 108 aircraft to be manufactured in India. These issues pertained to lack of common understanding between HAL and Dassault Aviation on following," the documents said.
It said HAL required "2.7 times higher man-hours compared to the French side for the manufacture of Rafale aircraft in India".
Congress has claimed that Dassault has been pressurised by the government to do away with the HAL as strategic offset partner by saying the future of India's aerospace industry has been destroyed by snatching Rafale from HAL.
Referring to earlier aborted deal, the document said Dassault was required to undertake necessary contractual obligation for 126 aircraft (18 direct flyaway and 108 aircraft manufactured in India) as per request for proposal requirements and contractual issues with HAL on manufacturing of 108 jets in India could not be resolved.
The submissions were made in the document titled "Details of the steps in the decision making process leading to the award of 36 Rafale fighter aircraft order", which were made public by the Centre on Monday. The inter-government agreement (IGA) was signed by the defence ministers of both countries on Sept 23, 2016.
Congress President Rahul Gandhi has been accusing Prime Minister Narendra Modi of forcing the French company to select a Reliance group firm of Anil Ambani as an offset partner to help it "pocket" Rs 30,000 crore.
Congress has also alleged the government was procuring each aircraft at a cost of over Rs 1,670 crore as against Rs 526 crore finalised by UPA government when it was negotiating a deal for procurement of 126 Rafale jets.
However, the document, placed by the NDA government, said, "It is reiterated that the procurement process as laid down in the Defence Procurement Procedure (DPP)-2013 was followed in procurement of 36 Rafale aircraft.
Nothing to hide:
The Centre said that in so far as discharging of the offset obligations by Dassault and its Tier I Vendors through Indian Offset partners is concerned, there is no mention of any private Indian Business House in intergovernmental agreement or Offset contract. The inter-governmental agreement between India and France were signed on Sept 23, 2016, the Centre also said.
Further it said that after the Indian negotiation team submitted its report on fully loaded 36 Rafale jets on August 4, 2016, it was vetted by the finance and law ministries within 20 days and the Cabinet Committee approved the deal on August 24 2016.
The pricing details were however given to the SC in a sealed cover. It may be recalled that on October 31, the Centre had claimed privilege on it. The court had however stated that the Centre should file an affidavit that it cannot submit these details.
Further the Centre said that Dassault the makers of Rafale or its weapon vendor is yet to submit a formal proposal in the prescribed manner indicating details of the Indian offset earners and products for offset discharge. Further the Centre said that until October 2019 no offset partner can get any money under agreement from India. The government also said it had nothing to hide and hence it was decided that Rafale prices would be revealed only to the Judges of the Supreme Court.
The court is hearing a PIL against the Rafale deal between India and France .
The petition sought information about the contract given to Reliance by Dassault.
Advocate M L Sharma's plea, filed earlier, alleging discrepancies in the fighter jet deal with France and seeking a stay on it will also come up for hearing on October 10.
Sharma claimed in his plea that the inter-government agreement to buy 36 Rafale fighter jets must be quashed as it was an "outcome of corruption" and not ratified by Parliament under Article 253 (Parliament has power to make any law for implementing any inter-government agreement) of the Constitution.
Rafale deal is a defence agreement signed between the governments of India and France for the purchase of 36 Rafale fighter aircrafts in a fly-away condition as a part of the upgrading process of Indian Air Force equipment. The Rafale fighter is a twin-engine Medium Multi Role Combat Aircraft (MMRCA) manufactured by French aerospace company Dassault Aviation.
Indian Air Force had advanced a proposal to buy 126 fighter aircraft in August 2007 and floated a tender. Following this, an invitation was sent to various aviation companies to participate in the bidding process.