Negotiations between India and France on the Rafale fighter jet deal have entered the final lap with both sides narrowing their differences over pricing.
The deal for 36 fighter jets was first announced during Prime Minister Narendra Modi’s visit to France last year. The two sides had hoped to wrap up the strategic order during President Francois Hollande’s Republic Day visit in January, but the two sides had failed to reach a consensus on the price.
As reported by DefenceAviationPost.com, India wants to keep the price at around Rs 60,000 crore.
Defence minister Manohar Parrikar had told DefenceAviationPost in an exclusive interview last month that he wanted to close the multi-billion dollar deal as early as possible.
“I don’t fix timelines but I am definitely interested in finishing it as early as possible,” Parrikar had said. He had, however, said that price was an important issue. “Price is equally important. While I want the aircraft I will definitely be interested in the right price,” he said. The deliveries of the nuclear-capable multi-role Rafale jets are likely to begin in 2019.
Indian officials led by Parrikar have been negotiating hard to bring down the price of the Rafale deal. The expectation is that the final deal will be clinched by May-end. Parrikar had earlier said he was a “tough negotiator” and wanted the “best price” for Rafale fighter jets from France. “I am a tough negotiator. Let me save money for the nation,” Parrikar had been quoted as saying.
The deal comes with the clause of delivering 50 per cent offsets, creating business worth at least 3 billion Euros for smaller Indian companies and creating thousands of new jobs in India through the offsets.
Under the proposed deal, companies like Safran and Thales will join Dassault in providing state-of-art technologies in stealth, radar, thrust vectoring for missiles and materials for electronics and micro-electronics.
India’s decision to scale back an original plan to buy 126 Rafale planes to just 36 in fly-away condition, has led to a renewed interest from top global manufacturers for setting up manufacturing facilities in India.
Lockheed Martin Corp have pitched its F-16 Fighting Falcon and Boeing Co its F-18 Super Hornet to Indian officials. Both are offering to transfer production to support Modi’s ‘Make in India’ drive to boost India’s industrial base and reduce its import needs.