Terms Non-Negotiable On MMRCA Rafale Deal; Indian MoD

Indian Defense Minister, Manohar Parrikar on Tuesday made it clear to the French Government that there would be no compromise on the costs and Request For Proposal (RFP) of the purchase of Dassault Rafale Multi Medium Role Combat Aircraft (MMRCA).

“We have conveyed our stand to them very clearly. No terms are negotiable and they (French Government) have to make up their mind as to whether they can do it or not. We can’t keep on waiting,” Parrikar told media outside parliament. “The Ministry will think of strengthening the existing fleet of Su-30Mki in case the deadlock continues.”

Parrikar had earlier last week said, “Rafale deal is not through or final. If it is at all finalized in future, it will take time. I would not like to comment on it as it is still in the negotiation stage,” he said during the lower house session.”

"I am waiting the Contract Negotiation Committee (CNC) report and until the detailed report is submitted, I will be unable to comment on the MMRCA aircraft acquisition. I have asked the CNC to expedite the report. The report is expected in March if not February. It is essential for the ministry to make a final decision about the deal,” Parrikar had said during the Aero India Airshow last month.

The cost of the program was $12 billion when the initial tender was floated in 2007. The price shot up to $18 billion when Dassault won the contract as the lowest bidder in January 2012. The transfer of technology, life cycle costs and creating assembly line might finally cross $20 billion.

The government may find it difficult to justify a nearly 80% price hike for the Rafale jets to the Indian parliament. In the past, the accounting watchdog, the Comptroller and auditor general (CAG) has criticized the government for its fiscal conduct while concluding defense deals.