India Set To Close Negotiations On $8.7 Billion Rafale Deal

The Indian Cabinet Committee on Security (CCS) is set to approve the closure of negotiations between the Indian defense ministry and Dassault to buy 36 rafale fighters.

The settled price for the fighter aircraft is about 7.8 billion euros with deliveries starting 2019 and an annual inflation capped at 3.5%, Hindustan Times reported Monday.

“The cost of 36 fighters will be around Rs 7000-8,000 crore (US$ 1 billion) lower than that what was being offered to the previous UPA regime in the now cancelled contract for multi-role medium range combat aircraft (MMRCA). Rafale had been shortlisted as the lowest bidder in the MMRCA tender,” the news daily quoted a senior official as saying.

The 36 aircraft with a full armament complement were offered at a maximum price of 11.6 billion euros with annual inflation pegged at 5%. This has been brought down to 7.8 billion euros with maximum inflation pegged at 3.5.

The Defense Acquisition Council (DAC) had last month reviewed the multi-billion Euro Rafale deal and directed the Indian negotiating team to submit its report "expeditiously". "The negotiating team has submitted its report, which is under examination," Indian defense minister, Manohar Parrikar had said in in August.

Parrikar had in July said that details including transfer of technology through offsets will emerge after the negotiations are completed.

The minister had said aircraft being procured will have advanced features like Advanced Electronically Scanned Array Radar, mid-air refuelling and advanced electronic warfare equipment as part of its design.