2

The Modi government claims that the Rafale deal it brokered is cheaper than the original deal by 9%. How did it achieve this? What concessions did Modi give to Dassault in order to get the deal at a cheaper price?

3
  • 4
    Rafale aircrafts are reputably so expensive that they're very hard to sell. It could be that he simply placed an order. Apr 9, 2019 at 12:29
  • 3
    Background: bbc.co.uk/news/world-asia-india-45636806 ; I suspect the actual reasons will be shrouded in secrecy.
    – pjc50
    Apr 9, 2019 at 12:39
  • 9% discount is not much. The company selling the fighter jets probably still makes a decent profit. Jan 10, 2023 at 18:54

1 Answer 1

-1

The said 9% discount is not a discount but a value-addition service done by Anil Ambani's Reliance and probably HAL. I.e., Dassault will transfer technology, and the aircraft will be built locally. Also, Dassault will invest 30% of the money back into India.

This is not a new maneuver in the history of the Indian defense industry. Previously, the Su-30MKIs went through the same type of negotiation and process. The only difference is that Rafale is an over-the-board expensive aircraft; therefore, it needed additional measures to cut costs.

The following is my observation:

  1. Rafale was a way over the board expensive aircraft, and the BJP government, in no way, did any favor to the Indian taxpayers by purchasing this aircraft.

    i. Rafale is a costly aircraft in the first place. When the UPA government was negotiating to purchase Rafale, that was probably part of the Indian MMRCA competition, where many manufacturers competed. Rafale did not come out to be the best aircraft in the competition considering strategic interest, money, and performance. The BJP government scrapped the whole MMRCA competition and started government-to-government negotiation, which was a wrong move to begin with.

  2. Rafale deal helped some businessmen to earn money. Therefore, BJP was not a saint. They indeed had some monetary transactions between the party treasury and those businessmen. However, that would probably be kept a secret forever unless a BoFors-style scandal ensues.

    i. Clearly, Anil Ambani's Reliance was a huge beneficiary of this Rafale deal. Please note that Anil Ambani was facing imminent bankruptcy, and this deal probably saved him.

    ii. Rafale's negotiation involved bribing. Susen Mohan Gupta worked as a middleman, and allegedly Dassault Aviation bribed him so that this deal could go through. It is not clear who he was working for. Was he working for Dassault Aviation or BJP or Reliance - this is a burning question.

So, the conclusion is,

BJP successfully pulled a substantial political move and brainwashed the entire nation into believing that Rafale was a ground-breaking deal that would benefit India in the decades to come.

The truth is - either it was an expensive deal, or it was a regular deal.

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .