India scraps French Rafale deal

India has scrapped a deal with France to buy 126 Rafale medium multi-role combat aircraft (MMRCA), after three years of negotiations, due to the high cost of the project.

India has announced that a deal to buy 126 Rafale medium multi-role combat aircraft (MMRCA) from French manufacturer Dassault Aviation is “effectively dead”.

The reason is the announced high cost of the overall project, according to the country’s online newspaper Business Standard.

The global tender for 126 medium multi-role combat aircraft (MMRCA) was the first time the Indian Ministry of Defense (MoD) had awarded a contract based on life cycle costing (LCC). This meant the winner of the tender would not be the fighter with the cheapest purchase price; instead the chosen fighter would be the one that was the cheapest to buy, fly, maintain and overhaul over its 30-40 year service life.

As per the original tender, eighteen of the 126 planes were supposed to be purchased directly from Dassault, while Hindustan Aeronautics Limited (HAL) was due to manufacture the other 108 under license at a to-be-built facility in the city of Bangalore.

Dassault Aviation has refused to take full responsibility for these 108 fighters to be manufactured in India, which automatically increased the overall cost of the whole project.

Defence Minister Manohar Parrikar has recently said that Sukhoi-30 MKI fighters, which had been built by Hindustan Aeronautics at its Nashik plant, could be substituted for them, according to the website IndiaSpend.

The Sukhoi-30 MKI is currently India’s most advanced fighter and forms the backbone of its air force. It’s also half the current cost of a Rafale.

The Indian Air Force first signed a deal with the Russian government to purchase eight air defense Su-30K and 32 multi-role Su-30 MK aircraft in 1996. IAF bought an additional 10 Su-30 MKs in December 1998.

Meanwhile former French Foreign Minister Roland Dumas said his country should deliver the Mistral class helicopter carriers to Russia.

Dumas has urged the authorities to give the Mistral helicopter carriers to Russia under the existing contract and called the anti-Russian sanctions imposed by his country a gross mistake.

According to Russian experts, Paris could face penalties as high as $10 billion if it fails to fulfill its contractual obligations over the Mistral order.

Source: Sputnik News