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Dassault Rafale, tender | News & Discussions [Thread 2]

SOURCE: ASIAN AGE

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It is an excellent move to sign a G2G deal on Rafale fighter aircraft but a ridiculous step if the government decides to restrict it to 36 jets, considering the size of the Indian Air Force, says former Chief of Air Staff Air Chief Marshal Fali Homi Major. The request for proposal for purchase of 126 medium multi-role combat aircraft was issued to six firms, including Dassault Aviation, when he was at the helm of affairs at IAF. Excerpts:

Q. What are your views on the government-to-government deal for acquisition of Rafale fighter jets?
We are adept at signing such deals as we have done it with the United States for C-17 Globemaster and the C-130J Super Hercules. It means that the RPF (request for proposal) for MMRCA will become irrelevant, and be cancelled. But the government must make it clear about how many (Rafale jets) will finally be acquired. If that number is only 36, it will be ridiculous because the idea is not to have too many types of aircraft for the IAF. The plan of the IAF was to have frontline squadrons of Su-30, MMRCA, Tejas and the FGFA (fifth generation fighter aircraft).It will be a nightmare to maintain a diverse inventory of fighters along with their spares and the supply chain. If we stop at 36, will be have another aircraft to perform the role of MMRCA?

Q. But the Rafale was rejected by many countries, even a wealthy nation like Saudi Arabia?
They could have rejected it for some reason or the other, but remember that the IAF adopted one of the most stringent selection processes to shortlist the Rafale and the Eurofighter Typhoon. The other countries rejected Rafale fighters for reasons which we are not aware of.

Q. And, acquiring these fighters off the shelf means no transfer of technology to Indian companies?
No country in the world will part with source codes and other strategic information as part of transfer of technology (TOT), but anything could happen if our government decides to acquire more of these fighters. If that happens, Dassault Aviation could select either a private enterprise or HAL (Hindustan Aeronautics Ltd) as it already has a good infrastructure and a number of private entities supplying thousands of components and subsystems. And whether it is HAL or the private player, they will have about two to three years to build the infrastructure before these 36 fighters arrive in India. Don’t forget that a private player can get the best employee from anywhere in the world, and pay them well, which is not the case with HAL because it is a defence public sector undertaking. So more qualified employees means better quality and faster manufacture of fighters.

Q. The defence minister says the IAF does not require a fleet of 42 squadrons, and could manage with fewer fighter jets because of better missile capability than in the past. Do you agree?
Partly, yes, but the number of squadrons depends on the threat perception, the weapons of adversaries and many other aspects.

If it is a scenario involving threats from two fronts, then we need 42 squadrons. Otherwise, with thirty nine and a half squadrons and the missiles, we could manage the threat. Now, we have only about 32 squadrons and that number must increase. There’s no doubt about that (enhancing the number of squadrons).
 
The shock and awe in Rafale deal
SOURCE : TRIBUNE INDIA

ON a tolerable day in Paris when the temperature was a balmy 21 degrees, Prime Minister Narendra Modi may have appeared to have flunked his first test for a man who claimed defence manufacturing was at the heart of his Make-in-India programme to create more jobs.
Emerging from talks with French President Francoise Hollande, Modi junked a decade-long selection process for fighter planes by announcing the immediate purchase of 36 Rafale fighters from the stable of the politically well-connected Dassault family.
This effectively buried the previous government’s grand plans of transparency in the selection process and leveraging the huge tender (initially Rs 42,000 crore, but now in the region of Rs 1.2 lakh crore) to create a hub of high tech in India by asking the winning company to source half the tender amount from India.
For the first time since he took power, Modi was also exposed to murmurs of having jettisoned transparency. The recent auctions for telecom spectrum and coal blocks were smooth affairs and netted the government much beyond what it had bargained for. But the bolt-from-the-blue approach to consummating the deal for fighters with France was not helped by a flurry of Tweets by Subramanian Swamy, an inveterate Modi backer, or the explanation that it had now become a Government-to-Government (G2G) deal.
The Indian armed forces have long been used to purchases of defence equipment taking a long slow route that lasts decades. The British advanced jet trainer was finally bought 20 years after talks first opened and several trainee pilots along with experienced teach-off and landing speeds spell trouble in case of a slight miscalculation. The hunt for a replacement to Bofors artillery guns has run through the tenures of the Vajpayee and Manmohan Singh governments, and there is no end in sight yet.
On cusp of a Bofors moment?
As was the case with Bofors guns, Rafale is an excellent plane. No arguments about that though Subramanian Swamy thought otherwise up to the moment Modi signed the pact with France. As was the case with Bofors, the Indian Air Force desperately needs planes that can perform several functions — fly low and long to bomb targets and get up in the air quickly to have enough maneuverability to take on enemy planes trying to bomb an airfield, bridge or an oil refinery. So, did he do the right thing by short-circuiting the elaborate toothcombing by the Defence Ministry by placing an order for 36 ready-made planes?
Apart from the bare cupboard of the Army when Rajiv Gandhi opted for Bofors and of the IAF when Modi inked the pact for 36 Rafale fighters, there is little in common between the two decisions.
The tender for 126 medium fighter planes was supposed to be different. With Sonia Gandhi as Chairperson, the United Progressive Alliance knew better than any regime the political fallout of a defence bribery scandal. Bofors made Rajiv Gandhi’s 400-plus seat cushion in Lok Sabha a bitter memory and the purchase of coffins during George Fernandes’ tenure at the Defence Ministry contributed to the erosion of goodwill earned by the Vajpayee government for astutely managing the Kargil conflict.
So, taking a lesson from both, the UPA installed AK Antony as Defence Minister and made nearly all mega purchases of defence equipment into a competitive affair in which all bidders were invited for pre and post-bid conferences. What must have been on top of Modi’s mind was that neither of the two approaches worked and some crucial sectors in defence seemed to be slipping back to the pre-Kargil state of neglect. Antony was prone to referring every single complaint to the Central Bureau of Investigation, even if it was an innocuous Defence Ministry letter with nil security implications. And the competitive tender approach activated the dirty tricks department of almost every company in the fray, causing Antony to defer a decision on multi role helicopters, artillery guns and, of course, the 126 fighter plane tender.
In the 126 plane tender, Dassault, a veteran of the Indian defence market since 1957, was unwilling to guarantee the delivery schedules of planes to be made in India, nor was it ready to lower the price — which had ballooned to Rs 1.8 lakh crore by January this year.
India was also caught in a diplomatic tangle with France. Its company Areva was unable to set up six nuclear plants in Maharashtra despite a written assurance by then Prime Minister Manmohan Singh and despite Paris having been among the most enthusiastic in urging some recalcitrant Nuclear Suppliers’ Group (NSG) countries to vote to end India’s exclusion from the global commerce mainstream. Also, it was unable to act on assurances of an early order to Rafale given to previous French President Nicolas Sarkozy (whose party is backed by the Dassault family) as well as the incumbent, who too would like to remain on the right side of the Dassault clan.
So far the 36 plane order might not be a fit case for approaching the courts. This is because technically Modi has simply expressed his intention to buy the planes and nothing more. It is also untrue that no country is interested in Rafale. Egypt has an order for 24 and Qatar and UAE are reported to be interested as well.
More Rafale purchases
Since the announcement was made by the top executive authority of India, it cannot be cancelled. So it can be argued that India will now be forced to purchase more and more of Rafale planes to make up for the shortfall of MiGs, that are gradually being pulled out from active services. But the urge to somehow meet IAF’s requirement — if it was really that — has also undoubtedly weakened India’s negotiating position for better terms for maintenance.
Modi’s real test will come when negotiators sit down to pencil the fineprint. India will seek technology transfer while France is bound to seek a firm commitment for more planes. India must also get the software source code so that it can refigure the weapon systems and onboard equipment. A competitive approach was always going to be difficult. Most of India’s defence acquisitions have been through the direct negotiations route, be they the three aircraft carriers so far, the Sukhois, the T-90 tanks, frigates and destroyers, the AN-32, Il-76, C-17 and C-130 transport planes or even the Bofors guns. Technology transfer was also not negotiated in advance in many of the cases.
What Modi has to watch out for is better terms and conditions when his negotiators sit down to map the delivery schedules of the 36 planes and future orders. No one would be more competent to detect the chinks in the deal than the present Comproller and Auditor General of India, who was the Director General (Acquisitions) and then the Defence Secretary when the tender route was being pursued.

Rafale fighter aircraft

2 countries have itOnly France and Egypt have placed an order, while UAE and Qatar are interested in buying Rafale fighers. Some countries will wait for India to purchase, but Pakistan and China unlikely to get it.Comfort factorIndian Air Force has been using Dassault-made fighters since 1957, many parts in common with MirageCombat recordAfghanistan: Operation Enduring Freedom (2002-present)
Libya: Operation Unified Protector (2011)Multi-role planeAccording to Dassault Aviation, Rafale can carry out both air-to-ground strikes as well as air-to-air attacks and interceptionsDelivery dateIndia will not receive its first Rafale fighter jet for up to two-and-a-half years and tricky issues, including pricing, still need to be worked outParameters

Gun
One 30-mm cannon for dogfights and strafingStations12 external hardpoints and two wingtip railsAir-to-Air MissileFor dogfights: MICAAir-to-Surface MissileFor ground attacks, Exocet and
nuclear-capable missilesBomb1,000-kg laser guided bombsOther featuresRocket pods, Electronic Counter Measure pods

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5 that lost out
Grippen (Swedish): Power plant not much better than Tejas, a light fighter being developed in India. Made for action in Europe that doesn’t require a big range

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Eurofighter:Came second after Rafale. Big tail diminishes stealth capability. A product of consortium of four nations, some with predilection for sanctions
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F-16: Pakistani pilots very well versed with this fighter; home country US prone to imposing sanctions
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F-18: Work horse of US Air Force, not very good maneuverability; US prone to imposing sanctions
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New fighters for IAF: 5 yrs in the makingThe loss of MiG-21s during the Kargil conflict and superior performance by the French Mirage in hitting Pakistani forces’ supply lines contributed to the enemy capitulation and made the Atal Bihari Vajpayee government taking up Indian Air Force’s request for new fighters in real earnest in 2000. 2001
The government issues a request for information (RFI) but there was scepticism in some international capitals about India’s ability to afford such a large tender, then estimated at $10.2 billion.

2007Action hots up after the normalisation of bilateral relations with Washington following the Indo-US nuclear deal in 2006. Besides the F-16 (made by arms and space major Lockheed Martin), the US government asks India to also consider Boeing’s F 18\A Super Hornet. Government issues tenders asking six companies to test their fighters in India.

2008The competing companies — two American, three European and one Russian — submit voluminous bids, covering about 600 parameters. Planes start getting tested by Indian pilots at various locations from Leh at its coldest to restricted landing strips in the Indian Ocean and Bay of Bengal.

2011
French company Dassault’s Rafale comes out on top on various parameters with the four-nation consortium’s Eurofighter in second place. Bids by Russia, both American companies as well as a Swedish company are rejected.

2012
Dassault is officially acknowledged as having passed all the tests and emerged as the lowest bidder for 18 planes to be delivered in readymade condition and 108 planes to be made in India. The deal by now is 50 per cent higher than the original estimates.

2013Negotiations with Dassault continue and are nearly finalised but BJP leader Yashwant Sinha and then Rajya Sabha MP MV Mysoora Reddy consider it their “patriotic duty” to complain about loopholes in the deal. Then Defence Minister AK Antony orders officials to re-examine the deal.

2014As elections approach, Antony citing inadequate funds decides to put the deal on hold despite vigorous campaigning by French politicians.

2015Taking everyone by surprise, Prime Minister Narendra Modi announces that India will buy 36 readymade Rafael planes from Dassault. On the fate of the 126-plane tender, Defence Minister Manohar Parrikar says one car can’t drive in two directions at the same time, meaning Dassault will take the MMRCA cake. Parrikar attempts to gloss over the decision by saying this will be now a Government-to-Government (G2G) deal.THE PROBLEM INDIAN AIR FORCE FACES


  • Indian Air Force wants 45 fighter squadrons (18 in each squadron) for a two-front collusive threat. Many bombers and interceptors, all from the MiG stable, are to retire over the next five-six years.
  • Government authorised strength is 42 squadrons
  • IAF today has 25 active fighter squadrons, according to the Parliamentary Standing Committee on Defence. But IAF claims the number is 39.
  • 14 squadrons of MiG-21 (Vikram\Trishul, now Bison) and MiG-27 (Bahadur) aircraft to retire by 2024
  • Canberras, used for bombing runs, have already retired
  • Theoretically, the squadron strength will go down to 11 if there are no replacements.
  • But that is the worst case scenario. At least 13 Sukhois planes are getting inducted every year, almost the entire remaining fleet is getting life extension/more potent engines and weapon suites
Action Plan to arrest depletion

  • 272 Su-30 MKI to form 13 squadrons by 2020
  • 11 more Sukhoi\Fifth Generation Fighter Aircraft (FGFA) squadrons
  • Development of Light Combat Aircraft ‘Tejas’ by HAL accelerated, at least six squadrons are projected
  • 3 Mirage (Vajra) squadrons being upgraded
  • Therefore, Medium Multi Role Combat Aircraft (Rafale): 2 squadrons or 36 fighters to be with IAF by 2020, 4 to 5 more squadrons subsequently. Can perform both ground attack and interception functions. Lighter than Sukhoi.
  • 6 Jaguar (Shamsher) squadrons to be upgraded
  • MiG-29 (Baaz) 68 being upgraded
  • Plane mounted radars – AWACS – to boost potency
Voices for, against
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One car cannot run on two roads… this is a much better deal… the cost per jet would now be cheaper. Buying 126 (fighters) would cost India about
Rs 1 lakh crore. Can we spend so much money on a high-end fighter? – Manohar Parrikar, Defence Minister
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When my PIL is ready on Rafale, I will send it in a sealed cover to the party president for sanction to prosecute… Rafale is a less fuel efficient aircraft and lacks essential performance characteristics – Subramanian Swamy, Bjp leader


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The life cycle maintenance calculations for the 126-plane tender are wrong. Favouritism has been shown to Rafale – Yashwant Sinha, BJP leader, in a letter to then defence minister ak antony

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There are irregularities in the evaluation process and the entire matter should be probed. Why has Rafale, not bought by any other country, been chosen for the Indian Air Force? Its performance in the recent air campaign in Libya was poor and the Rafale failed in precision bombing – MV Mysoora Reddy, then MP, in another letter to antony

Rafale are not poor quality, but India will have to pay an arm and a leg for it at over $200 million per unit cost. The more advanced Su-30, with full ordnance load, comes in at less than half the price – Bharat Karnad, centre for policy research


 
‘36’ – Let the force be with India
SOURCE: ASIAN AGE

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PM Modi’s decision to purchase 36 Rafale fighters ‘off the shelf’ from Dassault and the promise to buy another 30 without a tech-transfer regenerated a new debate on not just India’s vulnerable security and its vastly-depleted air cover but the need for a proactive PM like Modi to plug the lacunae in our defence

Prime Minister Narendra Modi’s decision to buy 36 Rafale multi-role fighter jets off-the-shelf from France in a government-government deal was a surprise, but it was timely and bold, putting at rest rumors and debates that tend to show the country and its decision-making process in poor light. We are bombarded with information and some disinformation. Invariably, facts get dulled when emotions rise.

We must understand why we got into a situation in which we had to abandon a more than 15-year long process to acquire fighters for the air force and finally take a different path, something no nation can afford to do repeatedly if it’s to defend its borders and undertake military missions.

The possibility of having to import combat aircraft for the IAF became a reality after a review of the Project Definition Phase of the indigenous Light Combat Aircraft, later to be named Tejas, in 1993/94. The review indicated that the LCA project would slip by 10 years, if not more. The Aeronautical Development Agency, which ran the LCA program, was untested and the Committee System of management (with too many members) instituted to run it served only to dilute accountability for the project.

With the LCA thus delayed and unavailable to replace the depleting and ageing fleet of MiGs in the IAF, the status of combat aircraft inventory started to get critical. The capability gaps created by the retiring fleet could not be augmented adequately, although upgrading MIG-21s, Jaguars and the gradual induction of Sukhoi fighters helped ensure aircraft availability for missions. Around 20 used MIG-21 two-seaters (from Russia and Central Asian Republic) were procured as a desperate measure to fill the gap of a supersonic combat trainer. The IAF even got permission to explore the possibility of procuring used Mirage-2000 from UAE / Qatar, but even as France was on the verge of shutting down the production line of the Mirage-2000, a light combat aircraft that had served well and buying more of which was the first option considered by the IAF, the used Mirage fighters from UAE / Qatar were not found to be a cost-effective option.

That was when the Rafale fighter was examined as a possibility (This was around time that American fighters were still out-of-bounds for India). Simultaneously, information was obtained on status of development of Gripen, a design that was closest to the Light Combat Aircraft. The Euro-Fighter Typhoon had still a long way to go and was not even on offer at the time. The Ministry of Defence was informed of the necessity to augment the fighter fleet through import. Had the LCA come up on time, perhaps we would not have gotten into the acquisition process for the Medium Multi- Role Combat Aircraft, as the competition for the multi-billion dollar deal came to be known, for at least another 10 years or so, until a new exigency arose.

Many are now saying that we could have done better by buying more Sukhoi aircraft, but the Su-30MKI is a large aircraft (over 30 tons) and has extensive capability. When we bought them, it was a new concept for IAF which took a cautious approach, initially limiting orders to around 40, and gradually increasing the numbers.

But the Air Force needed a large number of smaller and lighter combat aircraft of MIG-21 / LCA class. The Request for Proposal for what was initially 126 Multi-Role Combat Aircraft (MRCA) then became one that added on medium-weight aircraft, too, encompassing a variety – from the Gripen- an LCA class fighter to the F-16 and Mirage-2000 class, the F-18 improved variant was possibly as big as the SU-30MKI and the Rafale and Euro Fighter Typhoon that were larger than the F-16s and two-engined. These last two being from the latest vintage, employed more advanced engineering and design offering capabilities and flexibility not envisaged before.

That is about the time when the strategic situation was undergoing change – Pakistan was not the only adversary and crossing the Himalayas posed more challenges. It was an even greater challenge for the MOD, facing severe budgetary constraints for modernization of the military and not just the Air Force alone. The government was constantly under fire.

The number 126 as the requirement of number of fighters is magical, typically arrived at by MOD Finance to limit the numbers, after considering the Air Force’s demand. Oddly, such numbers somehow appear authentic — 66 AJT, 76 Jaguars, 106 more Pilatus, 36 Rafale etc (ending in 6 may have been considered lucky!). These numbers never made sense. We built more Jaguars and ordered additional Hawks. There are good reasons to believe more Rafale jets will follow the current 36 to be ordered. In fact, it is difficult to sustain two Squadrons with 36, since that number does not leave reserves for maintenance/repair. Experience shows that it is easier to push additional orders if the aircraft is produced in India under licence. (We placed additional orders of HS-748 and Dornier 228 just to keep HAL going).

But has licence manufacture, as the original plan for 126 Rafale jets was, helped to ‘Make in India’? The answer is ‘Yes’ since technically these would be made in India. But does it promise self-reliance? The answer is an emphatic NO. Hundreds of licence manufacture of MIG series, Jaguars, Hawk, Su-30MKI in no way helped in developing and manufacturing indigenous design. Processes and machines acquired for licence manufacture have had limited usage once the line is closed. Production technology in no way helps to design and develop. Importantly, the total cost of licence manufacture is far more than direct purchase since it also included IPR, documents, travel and support, training etc. Direct purchase has least risks, is least expensive and if Off-Set clauses are applied (that would also cost) could help develop domestic small and medium enterprises.

The Rafale experience should therefore teach us that we need to be self-reliant. And the only way to reach achieve self-reliance is to design and produce from scratch – intelligently applying knowledge and developing skills on the way. ‘To Evolve’ is the key. We could always hire experts from anywhere in the world when needed as we did to develop the Marut or the ALH.

Developing and producing indigenously is a matter of pride. HT-2, HPT-32, Marut, ALH, LCH, LCA etc generated very special enthusiasm and pride. We are capable of meeting all our requirements of ‘Light Helicopters’ and Trainer aircraft but the push for import is discouraging. What could be the reasons?

We have no faith in our own ability to design and produce by specified time, to the performance desired and at the cost envisaged. No one seems accountable. The military has little say in projects once initiated. Often, the frustration turns on the Users. The military is the user and it is not their decision to buy or make. That is the privilege of the government. Today, the Intermediate Jet Trainer is languishing – a relatively simple design. Our most strategic need to develop a Jet Engine has consumed billions of rupees but it seems to be heading nowhere. The Air Force cannot push any of these projects!

We are not sure what lies beyond the order for 36 Rafal jets. I am one of the optimists. All stars appear favorable; we have capable leadership whom we must trust. We must invest in a big way in the LCA Mk-II, the ALH, LCH, LUH and all the rest that are to follow. We should no longer import things that we can design and make ourselves. Accountability must be ruthlessly enforced and initiative must be encouraged. The user – the Indian military — must be firmly in the saddle to drive their programs. Indian Aeronautics keenly awaits a new dawn. We must not miss this opportunity.

S. Krishnaswamy is a former Chief of Air Staff


Aq to veteran officer we r going to have 66 rafales!!
 
Modi’s “Flyaway” French Deal
Friday 17 April 2015, by M K Bhadrakumar

If Libya’s Muammar Gaddafi were alive, we could have asked him how the French get around authoritarian rulers and tin-pot dictators from the developing countries who carry fat cheque books in their pockets while travelling abroad. As the dreamy picture in The Hindu newspaper immortalises the moment for historians of Indian diplomacy, the French leadership went the whole hog to make Prime Minister Narendra Modi’s visit memorable.

The entire leadership—President, Prime Minister, Foreign Minister and the charming Mayor of Paris herself—kept aside their weekend to escort Modi on a Seine cruise. Howzaat? That would make President Barack Obama go green with envy. Even with the alluring “Belt and Road”, President Xi Jinping could not get such a welcome as Modi got, worthy of a Haile Selassie, the Rastafarian messiah, the lion of Judah. (In fact, the French hosts even allowed a protest march by the Tibetans when Xi arrived.)

Now, that was all for a very good reason. The French got, finally, what they wanted, namely, a revision of the terms of conditions of the MMRCA deal that would absolve them of the need to make the Rafale fighter aircraft in the shoddy Indian defence factories.

Any vendor would love to sell rather than co-produce with the buyer, but the previous United Progressive Alliance Government was adamant for some strange reason that the French should stick to the terms of the tender under which they had won the deal. Maybe, it was the then Defence Minister A.K. Antony’s magical touch. Or, maybe, the UPA didn’t want yet another scam of arms procurement by the Indian armed forces on its hands.

At any rate, Modi has now blinked. Period. We should wait for Subramanian Swamy to redeem his pledge to file a suit in the Supreme Court in order to get to the bottom of what really happened for the Modi Government to mothball the original MMRCA deal and instead opt for the “flyaway” Rafale.

No matter the spin being given, the chilling truth is that the MMRCA deal has been arbitrarily revised by Modi on a balmy weekend afternoon in Paris. Just like that. And, that too, without even India’s Defence Minister being involved in his discussions in Paris with his fawning French hosts. The fact that Defence Minister Manohar Parrikar was inaugurating a fish stall in his home State of Goa even as Modi was striking the “flyaway” Rafale deal in Paris speaks volumes about India’s cabinet system of government during the Modi era. It’s a disgrace. People usually call such countries “banana republics”.

The spin being given is that the French are selling at a competitive price. Of course, they will quote a good price. What else would you expect from shrewd businessmen? Because, any vendor knows that the trick is to somehow make the entry into the market. Good money can always be made in the downstream of such deals while selling spare parts and servicing the product and so on without having to go through open tenders.

Besides, the Indians have now no option but to buy dozens and dozens more of Rafale aircraft. The Indian Air Force is “locked in”. It can’t be that the IAF’s need for Rafale ends with 36 aircraft after having trained an entire cadre of personnel to fly and maintain the aircraft.

Don’t the French know all this from previous experience with the Jaguar deal? And when the deals for more purchases come into the pipeline, or when these 36 aircraft need servicing and “upgrade” eventually, then the French will extract their pound of flesh. Make no mistake about it.

Another spin being given is the insinuation that as quid pro quo, the French—who control the Airbus company (along with the Germans)—will aim at making the Airbus aircraft in India. This is baloney, plainly speaking.

I just flew in the Lufthansa’s Airbus 380. It will be in the 22nd century at the very earliest, if at all, that India can hope to possess a machine tools industry and trained designers and efficient technical hands to make such a sophisticated product like Airbus 380. The Germans will never allow us to get within a mile of their prestigious Airbus product, either. It is a flag carrier of German technology. And, in any case, we should be modest enough to know that making an aircraft is not like making pakoras.

Yet another spin being trotted out is the familiar spectre of threat perceptions—that India faces the threat of wars being launched by Pakistan and China—to justify the need to buy fighter aircraft in “flyaway” condition. A horrible thought is being thrust into our minds that the IAF is having to fight a war shortly.

But then, Defence Minister Parrikar himself now alerts us that the first “flyaway” Rafale aircraft will not even come into our possession for the next two years. ”Fly-away means not tomorrow,” he warns. As a highly qualified metallurgical engineer trained at the IIT, Bombay, he should know what our spin doctors seem to be unaware.

Put differently, we are being led to believe that the IAF is preparing to fight a war in 2018 or sometime beyond. But then, what if Pakistan or/and China decide to attack us before 2018—say, soon after Xi visits Pakistan in April and Modi visits China in May? Modi’s purchase will go waste?

Why is the Modi Government and those sections of our media who don’t do their homework properly making fools out of the Indian public? Look, nobody in the first instance forced Modi to conjure up from thin air this entire dream of ‘Make in India’. It was purely his brainwave to make Indians feel proud and ecstatic and lift their spirits up from their dreary existence. But, now he has taken the dream back and suo moto dumped it in the Seine River in the weekend without even taking them into confidence. That’s a terrible thing to do—selling a dream and then snatching it back.

At least, this government should do us a favour—Modi and his Ministers should never dare to utter those eleven syllables again, ‘Make in India’. If they do so again, it will be an insult to the Indian people’s common sense and intelligence. A non-performing government is bad enough. But to sell airy dreams to the people is the height of political cynicism.

Ambassador M.K. Bhadrakumar was a career diplomat in the Indian Foreign Service. His assignments included the Soviet Union, South Korea, Sri Lanka, Germany, Afghanistan, Pakistan, Uzbekistan, Kuwait and Turkey.
 
Air Platforms
Indian Rafale deal to be finalised 'by end of May'
Rahul Bedi, New Delhi - IHS Jane's Defence Weekly
20 April 2015


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Talks to buy 36 Rafales off the shelf should be concluded by the end of May, Indian officials have said.
India and France aim to finalise the deal for 36 Dassault Rafale fighters for the Indian Air Force (IAF) by the end of May, according to defence industry sources.

Indian prime minister Narendra Modi is believed to have insisted on this deadline with his French counterpart Francois Hollande in Paris, soon after announcing the fighters' procurement on 10 April.

Once inked, the IAF will be the first customer, after the French Air Force, to acquire Rafales. Egypt has also agreed to buy 24 Rafales.

Meanwhile, a delegation comprising senior French government officials and top Dassault executives is expected in New Delhi over the next few days to begin negotiating the fighter contract, which is estimated at around USD5-6 billion. French defence minister Jean-Yves Le Drian is likely to be part of this delegation, but no confirmation of his inclusion was possible.

Industry sources familiar with the ongoing talks between the two governments told IHS Jane's that Dassault is reported to have agreed to more than double its annual Rafale building capacity from 11 to 24 aircraft. The company had slowed down Rafale production rate to around 11 platforms per year as no new orders were forthcoming.

The French government is also believed to have persuaded its air force to reduce its Rafale induction until the IAF contract is fulfilled.

Indian defence minister Manohar Parrikar told the Mail Today newspaper on 16 April that the accounting process for the Rafales would be completed within 2-3 months and deliveries would begin in 18 months. "So roughly it [the contract] will take three years," he said.

Negotiations between the MoD and Dassault over the acquisition of 126 Rafales under the Medium MultiRole Combat Fighter requirement have been deadlocked since January 2012 due to disagreements about the responsibility for the 108 platforms to be licence built in India.

Since Modi's announcement in Paris it is unclear whether India will directly import additional Rafales or licence-build them, or both.

Indian Rafale deal to be finalised 'by end of May' - IHS Jane's 360


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Editorial: India Still Needs Bigger Rafale Deal
Defense News3:33 p.m. EDT April 20, 2015

The decision by Indian Prime Minister Narendra Modi to order 36 off-the-shelf Rafale jets was an overdue and welcome move to upgrade New Delhi's military capabilities.

It is worrisome, however, that he stated that talks were dead between the jet's maker, Dassault Aviation, and India's state-owned Hindustan Aeronautics Ltd. (HAL).

Three years ago, India chose the Rafale as the preferred vendor in its global competition for a new fighter. The plan was to buy at least 126 of the jets, but negotiations dragged on over New Delhi's demand to build as much of the aircraft in India as possible.

Dassault has a long history of licensing production — including with India — but the sticking point was who would be liable for the quality of the planes built in India. Dassault, rightly, was unwilling to be held accountable if HAL fouled up manufacture of a jet as sophisticated as the Rafale.

On his visit to Paris, Modi acted with pragmatism, ordering 36 planes that would be built by Dassault in France and sent to India. It remains to be seen what will happen to the 126-strong order. It's the second order for the Rafale after Egypt became the first export customer for the twin-engine jet.

Indian officials have hinted that the bigger Rafale deal would be negotiated government to government, rather than between Dassault and HAL.

That's the right approach given the impasse between the French and Indian giants. The entire rationale of the program was to upgrade India's Air Force, replacing aging MiG-21 fighters, as well as boost the country's industrial capabilities with an infusion of technology and knowhow.

What India can't afford is to break up the fighter contract to gain favor with as many players as possible. Moscow has been aggressively courting New Delhi as a partner on an Indian variant of Sukhoi's Su-30, which is already in India's inventory.

The reason India turned to France was to improve its military and industrial capabilities. With the ball finally rolling, it's vital that the two nations conclude a wider deal that will be good for them both.

Editorial: India Still Needs Bigger Rafale Deal
 
TO PLUG THE GAP IN THE SKY MODI AND PARRIKAR PUT THE INTEREST OF THE IAF ABOVE EVERYTHING ELSE

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RAFALE - The fighter IAF was pushing for all along
by Nitin A Gokhale

When Manohar Parrikar took over as India’s defence minister late last year, many defence pundits sniggered. What will a provincial politician from Goa know about the complex issues in the defence ministry, felt the high and mighty denizens of Lutyens’ Dilli. Those who have their fingers in the defence pie rubbed their hands in glee: here’s a tyro, an outsider to Delhi’s power corridors who would be easy to manipulate, they might have been thinking. Less than six months on, the smiling, not-so-articulate Parrikar has set the cat among the pigeons by breaking the nearly decade-long logjam in the procurement of crucial fighter jets for the Indian Air Force (IAF) and demonstrating the kind of quick decision-making many thought beyond him. The decision to buy 36 Rafale combat aircraft from the French company Dassault Aviation in ready-to-fly condition, announced by Prime Minister Narendra Modi in Paris, was a classic example of the political leadership taking a bold, unconventional decision to meet an urgent operational necessity of the armed forces. In this case, a government-to-government deal was found as the means to breaking the logjam that had been standing in the way of the Indian Air Force (IAF).

Parrikar convinced Modi on the need to find an solution. He then kept to the sidelines loyally.

In an interview to Doordarshan, Parrikar gave cent per cent marks to the prime minister for effecting the deal, thereby underplaying his own role in reaching this out-of-the-box decision. As he reviewed crucial projects and issues pending in the defence ministry after taking over, Parrikar quickly realised that the mega MMRCA (Medium Multi Role Combat Aircraft) contract was going nowhere despite three years of negotiations between the Ministry of Defence (MoD) and Dassault Aviation, which had emerged as L-1 (the lowest bidder) in a competition that had begun in 2007. The issues were too complex. The cost of buying 126 fighter jets was too massive—anywhere between $ 16-18 billion—for any bureaucrat to take a final call under the current Defence Procurement Procedure (DPP). The IAF, on the other hand, was pressing hard for a quick decision: it was worried about the rapidly falling strength of its combat fleet.

Parrikar, an IIT-Powai product, grasped the nettle, took the issue to the prime minister and made him understand the urgency for breaking the deadlock. Hours before Modi took off for Paris, the duo arrived at a pro tem solution: buy Rafale directly under a government-to-government contract, even if it meant ignoring for once the ‘Make in India’ concept. The prime minister—despite being the author of ‘Make in India’—backed Parrikar to the hilt. And true to his promise, told the French of India’s intention.

It’s no surprise that sceptics have criticised the decision. The carping has ranged from “It’s too little, too late” to “It goes against the ‘Make in India’ concept”. There are whispers that the Ambani brothers might have made a backdoor entry. But Modi and Parrikar put the interest of the IAF above everything else. It must be borne in mind that procuring 36 Rafales is a stop-gap arrangement. It is meant to arrest, only if temporarily, the rapidly falling numbers of aircraft in the IAF’s combat fleet. The government will have to work out a detailed plan to replace over 200 fighter jets that will retire in the next four years. Parrikar has already hinted in one of his interviews how he plans to overcome the shortage, but all that will come in the near future. At the moment, he has demonstrated a rare decisiveness in the defence ministry. Under A.K. Antony of the UPA, India’s longest serving Raksha Mantri, the ministry had come to epitomise procrastination.

To Plug The Gap In The Sky | Nitin A. Gokhale

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INDIA’S RAFALE DEAL: WHY THE OUTRIGHT PURCHASE WAS A BALANCING STEP

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by Prashant Dikshit

The Indian government’s decision to purchase 36 Rafale MMRCA aircraft from France outright, as against the original 18, with a direct government to government deal with France could be the best option. This is because the issues were no longer merely commercial in nature; there were strategic reasons to be considered.

The most apparent and crucial matter of the rapidly decreasing combat punch of the Indian Air Force (IAF) was not the only issue at hand. The decision to select the Rafale at the outset was already made with the conscious view that it was the best buy. It not only satisfied the operational framework of the IAF, but also ensured that with its acquisition India will put the eggs in the correct basket.

India has invested more than adequate material resources in the burgeoning strategic equation with the US and has acquired maritime and heavy-lift transport aircraft, among other weapon systems. Deeply emboldened by the mutual India-US wooing syndrome, the US administration is leaving no stone unturned to participate in the India’s aircraft carrier industry. On the MMRCA front however, there were disappointments in the US industry circles that India had found the F-16 aircraft somewhat outmoded and the F-18, too heavy and alien for its systemic construct.

But it had obviated Indian policy planners’ deeply embedded fears that the complex structure of the US regime – that consists its presidency, the senate and the congress – could place embargoes on technical and material support in the future for such a crucial combat ingredient; just because some law-wielding segment US did not see, eye to eye, with Indian policies elsewhere. There was precedence on this score in the past and the Indian establishment has institutional memory of having encountered such impediments; and the development of India’s Light Combat Aircraft is one of the many examples.

As for Russia, India is already acquiring over 250 Su-30 MKI air superiority fighters and most importantly, is developing Fifth Generation Fighter Aircraft plus a Medium Transport Aircraft along with other weapon platforms such as the BrahMos in collaboration with Russian majors.

Although, the all-weather relationship with the erstwhile USSR and now Russia has stood the test of time and India availed of Russian support on not only the Arihant nuclear submarine but also substantially for the operation of nuclear power plants, uncertainties and irritants faced by India’s defence establishment for provision of spares for military hardware after the breakup of the USSR and again, before the eventual induction of the aircraft carrier, INS Vikramaditya, could not be ignored. Additionally, there is an emerging perception that with the rising clamour for enhanced price structures by Russian companies, the mutuality of equations is tilting towards greater commercial gains and the tenor of the relationship may have come to a saturation point. The Indian endeavour would rather be to sustain than to increase.

India had already procured adequate materials from UK during its post-independence relationship. The British-made Jaguar joined the IAF fleet with over 150 aircraft to fulfil the IAF’s requirement for Deep Penetration Strike Aircraft; over 120 of the British Aerospace built Advanced Jet Trainer, the Hawk, have been inducted in the IAF and the India Navy with an Indian government investment of nearly $ 2 billion. These purchases had set up a pipeline for infusion of spares periodically from aviation majors in UK. The British industry had nothing more to offer.

With France the story is different and the developments had to be placed on an even keel. First, the uncertainties in nurturing the contract with the French aviation major Dassault, the producer of the Rafale, had emerged because the manufacturer had declined to accept responsibilities for the 108 machines that were to be assembled by Hindustan Aeronautics Limited. There is a strong view that some in the South Block had persuaded Dassault to accept this clause against the manufacturer’s judgment and these doubts could not be kept under wraps beyond a point.

Eventually, the whole deal was falling through due to procedural impositions of the treatment of “Request for proposals.” There was an emerging perception that at risk was the equation with France – whose support in operating their Mirage 2000 with the IAF was pivotal in countering the aggression during the Kargil war. France is going to be a supplier of nuclear materials to India, and with whom India is pursuing several space ventures through its Department of Space. However, the most crucial of all reasons why this is strategically important is due to France’s unstinted support for India’s membership in the UN Security Council.

India's Rafale Deal: Why The Outright Purchase Was A Balancing Step - Analysis - Eurasia Review

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INTERVIEW: INDIA’S RAFALE DEAL

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by Sanjay Kumar

The recent Rafale deal and its significance for India’s relations with France.

While visiting France in early April, Indian Prime Minister Narendra Modi announced the acquisition of 36 French Dassault Rafale jets. The announcement capped years of sometimes contentious negotiations, which had intensified since Modi came to power last year.

The Diplomat’s Sanjay Kumar spoke with senior journalist Ingrid Therwath, South Asia editor withCourrier International, a leading French magazine, about the significance of the deal for France and its relations with India, and what might lay ahead.

How was the deal finally done? Were you aware of it?

Initially, the figure that was announced at the joint press conference between Indian Prime Minister Narendra Modi and French President Francois Hollande was a bit of a disappointment. For three years the deal was on the table and negotiations had been going on for 126 fighter jets. I learned through an informal source 24 hours before the joint press conference that it was to be 63 Rafale jets. When Modi announced the decision to buy 36 jets there was initial shock and disappointment among the French people.

However, more than disappointment there was a sense of relief that the deal has come out of the lurch which it has been in for the last three years. Both India and France were eager to break the logjam and move ahead. Negotiations were going on and on. There is relief in France now that something has come out of the three years of negotiations.

What does it mean for France?

The French government has a target of selling 40 Rafales this year. A couple of months ago Egypt bought 24 and now India is buying 36 off the shelf. This is rather good news for Dassault, which was facing a huge financial crisis. The deal comes as a lifeline for the French defense industry.

The fighter jet deal is a big political boost for the beleaguered French President François Hollande, who has been floundering ever since he assumed office in 2012. His popularity is really low. In recent local elections his socialist party performed very badly.

Now with the defense deal the government can showcase positive figures on the economic and defense fronts. Hollande’s international stature has gone up after the agreement.

Does the deal herald the end of the negotiations and the final cap on the number of combat aircraft that India is going to buy from France? Or is the transfer of technology, India’s main demand over the years, a possibility?

There are two ways to look at the deal. Either India gets out of the Rafale deal saying that we have bought the plane and that’s it or India now goes to phase two of the negotiations which I think is likely, though I am not privy to the confidential part of the deal. The reason being that Indian military needs to renew its equipment; its fleet is aging. The Rafale is a true multi-role combat aircraft. Though it is expensive, it is efficient. India has varied terrain and a location in a complex geopolitical neighborhood – the Rafale suits its requirements.

If there is a phase two of the negotiations it would be centered around the transfer of technology. France understands that for New Delhi, the Make in India concept is important.

In the French media there has been discussion as to the recipient of any technology transfer. Can you shed some light on that?

The question is who would build the new lot of Rafale jets if the transfer of technology takes place. Would it be state-owned Hindustan Aeronautics Limited (HAL) or some private player. That is the issue both in France and India. What I gather from my sources is that Indian industrialist Mukesh Ambani’s company is really keen to do a technology transfer in the defense sector. Ambani is a big contender. With India’s biggest industrial house a very close friend of Modi, Ambani coming into the picture is a real possibility. Dassault is also not keen on HAL. It seems that the government-owned company is not a reliable partner. It does not subscribe to strict quality standards.

Are you aware of the criticism in a section of India’s media, terming the deal too expensive and done without a proper bidding process.

The French general public are not really aware of the debate going on in India. I don’t think there was any irregularity in the deal. There were six contenders initially so it was a fair game. What is happening in India between HAL and Ambani, the French press is not bothered about that. Its an internal issue for India. But France is happy that the deal got unstuck and came to be signed .

How do see Indo-French relations after Modi’s visit?

I think the relationship has always been very good. France and India really like each other. For the French, India is a wonderful country, and the majority [of the French people] have a very positive image of the South Asian nation. France would like to do business with China but they have a very negative image of the communist regime. India has soft power. France has always been a consistent ally of New Delhi. If you had noticed, France raised concerns over the release of the 2008 Mumbai attack mastermind Zakiur Rehman Lakhvi recently. This deal deepens that bond.

What other agreements were inked during Modi’s visit to France?

There were number of other deals that were signed between France and India. They signed agreement on water, sanitation, waste management, transport and metros, roads and infrastructure. One important deal was on the European Nuclear Reactor, built by AREVA in Jaitapur in the western Indian state of Maharashtra. The negotiations with AREVA were very difficult because of local resistance to the nuclear plant. The deal is important for the French nuclear firm. Just as Dassault really needed the Rafale contract to boost its financial position, AREVA also needed [the Indian deal] for its survival. So the Indian PM’s visit has been oxygen for these companies.

Interview: India’s Rafale Deal | The Diplomat
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Q. Was the Indian Air Force on board when the government took the decision to buy 36 Rafale fighters under the government-to-government (G2G) route from France?

A. I consulted the air force to the extent it was required. They have no role in decision-making as ultimately it's the Prime Minister's call.

Now that's an importan piece, which shows how we ended up in this possible disaster! As expected, neither the DM wanted this (which is evident, since it's the opposite of what he tried since Dec), nor were the IAF involved, but it's a sole decision of the PM against everything the MoD, IAF and the Indian defence Industry worked for in the last few years. I thought the LUH scrapping of him was bad, but this is just insane!
 
RAFALE DEAL - TRUTHS BEYOND RHETORIC

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by Premvir Das

The decision to purchase 36 Rafale aircraft outright from France has understandably created a stir. It apparently flies in the face of the "multi vendor, open tender, transparent" approach ongoing for close to 14 years in which this aircraft was first found suitable, then qualified as L1 (lowest tender) and then there were prolonged contract negotiations. The plan to buy 18 planes outright and build the remaining 108 in Hindustan Aeronautics Limited (HAL) through transfer of technology has now collapsed; the latest decision will, inevitably, include an Option Clause for some more outright purchases as the ordered number is clearly not viable.

First, it is true that the negotiations dragged on for too long but not for any fault of HAL. The French manufacturer was refusing to adhere to the terms specified in the Request for Proposals (RFP) sent out to all vendors; it was also not prepared to guarantee performance of aircraft manufactured in India, once again a clear violation of the terms of the RFP. Second, this delay was already beginning to affect the force level of combat aircraft that the Air Force was slipping down to; as per its projections the reduced strength could have serious consequences on our fighting readiness and, thereby impact national security. Third, an idea was beginning to get mooted to jettison the Rafale deal and go in for additional Russian-origin SU 30MK1s, already being manufactured by HAL under licence and of which the Air Force had good numbers.

Let us look at some facts. First, the long-delayed LCA, planned replacement for the MiG-21, is now nearing operational status. Does anyone really believe that war or even limited hostilities with China or Pakistan are on the horizon in the immediate future? Provocations and assisted militancy, even insurgency could be a possibility - but outright war, requiring the urgent availability of versatile combat aircraft? So, the warnings put out that the country's security was in jeopardy were clearly hype. This notwithstanding, the falling strength of fighter aircraft is cause for concern and required corrective action.

But the serious issue is different. No military platform of any kind can be developed and built unless there is capability to design it; the ability to manufacture and procure different varieties of equipment often influences this first step but can only follow it. So, putting the drawings, hundreds of them, in place is the first essential prerequisite. If the Navy can happily turn out the most modern destroyers from its shipyards, the latest being Vishakhapatnam, launched last Monday, it is only because right from its earliest years, it has focused on developing design know-how and this has resulted in every ship being more combat worthy than its predecessor with increasing indigenous content both from the public and private sectors. Concurrently, it is necessary to give strong support to the building yards. The closest possible interface is needed between the buyer, the designer and the builder; and, if the four Navy shipyards today have more than 40 ships on order, it is because these three essential requirements are being met.

Interestingly, the Air Force had also embarked on this route early on, and aircraft like the HT-2, HPT-32 and HF-24 bear evidence to this urge. But thereafter the focus shifted to outright purchase with or without manufacture in India under licence - which generates skills in manufacturing techniques, but no benefits in acquiring design know-how.

While the Navy's design-and-build-in-India plans have moved strongly through focused attention those of the Air Force have not. It is true that we are still unable to produce much of the sophisticated equipment that modern fighter aircraft require but these can always be bought and integrated into the platform design. After all, even the latest warship being built at Mazagon Docks Ltd in Mumbai has weapons and sensors from different sources including our own, all interfaced into a complete system.

Taking the shelter of national security to force the "outright purchase route" has been the easy way out and over the years, political leaderships of all hues have succumbed to this threat.

The sad reality is that the apparently transparent multi-vendor route for military purchases is wholly unsuited to the Indian way of doing business, literally. Experience shows that where we go the single-vendor governmental route, things move faster and with fewer complications. So, opaque as it may seem, until design capabilities are greatly enhanced, this Hobson's choice appears to be the only route to take. All this may make for dismal reading. On the one hand, we want to manufacture modern military platforms in India; on the other, the essential capabilities required to do so either do not exist or are deficient.

Sadly, this is not something that can be set right overnight or just by shifting tack from public to private sector. The Army and the Air Force, which do not have in-house design structures, must involve themselves more closely with the know-how already created with DRDO and others, send more people abroad for training and, together, focus on building complex platforms. This process may take several years but there are no short cuts; it has taken the Navy five decades to get here. To think that private companies can start designing and building fighter aircraft when DRDO/HAL, with decades of experience cannot, is to live in a world of make-believe.

The Air Force must also involve itself more closely through greater control of HAL entities just as the Navy has been doing all along for its shipyards. This synergised Plan-Design-Order-Build approach is essential if the other two services are to get anywhere close to where the Navy has reached and, yes, it still has some miles to go.


Premvir Das: Rafale deal - truths beyond rhetoric | Business Standard Column


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LESSONS FOR INDIA: HOW THE 'MOTHER OF ALL DEFENSE DEALS' CRASHED AND BURNED


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…and what India needs to do to avoid flubs of the sort in the future.

India’s decision to procure 36 Dassault Rafale combat jets is an attempt to stop short-term hemorrhaging, but is not a substitute for the urgent need to address both the erosion of the Indian Air Force’s (IAF’s) force strength or gaps in higher defense management that continue to plague the Indian armed forces.

On India’s decision to opt for a government-to-government deal during Prime Minister Narendra Modi’s visit to France, Defense Minister Manohar Parrikar indicated that India’s Medium Multi-Role Combat Aircraft (MMRCA) project, which had taken 14 years from the projection of requirements to vendor selection, was effectively dead. The $10 billion MMRCA project for 126 combat aircraft was conceived by the IAF in 2001 with an aim to augment its force strength, which is at an all-time low of 29 squadron as a result of defense procurement inefficiencies, obsolescence and crashes.

It then took the Ministry of Defense six years after IAF conceived a requirement to then issue Requests for Proposal (RFPs) for the MiG-35, JAS-39, Eurofighter Typhoon, F-16, F/A-18 and Rafale. The terms of the initial RFP stipulated the purchase of 18 aircraft in “fly away” condition, while requiring the remaining 108 aircraft to be manufactured in India under a Transfer of Technology Agreement with the vendor, which would also be required to meet its offset obligations in India, per MoD’s Defense Procurement Procedure (DPP).

After vendor proposals underwent technical evaluation and field trials, the MoD announced in 2011 that it had narrowed down its selection to two vendors – Dassault (Rafale) and Eurofighter GmbH. In January 2012, India announced that it had selected Dassault as its preferred vendor and would enter into “final talks” before signing the deal. The process then ran into a stonewall.

First, allegations of irregularities in the selection process were made in the Rajya Sabha (India’s upper house of Parliament). Then-Defense Minister, AK Antony, whose desire to accentuate above all else his credentials as not being corrupt earned him the derisive moniker “Saint Antony,” ordered a probe that interrupted negotiations with Dassault for four months. Then, negotiations stalled over pricing differences and India’s insistence on guarantees over the 108 aircraft to be locally manufactured by Hindustan Aeronautics Limited (HAL). These differences ultimately proved insurmountable.

The government’s decision to source 36 Rafale combat jets from Dassault now raises new questions on how it intends to address significant force strength depletion in the IAF for which the MMRCA was conceived. In the seven years alone that it has taken the Government of India to issue an RFP for the MMRCA and enter into negotiations with Dassault, the IAF has lost 36 MiG aircraft due to crashes (of which a majority have been MiG-21s), as well as 13 other aircraft (including 6 Sukhoi-30MKIs, 3 Jaguars and 2 Mirage-2000s), effectively reducing IAF’s force strength by over 4 squadron.

Meanwhile, India’s Light Combat Aircraft (LCA) project, awarded to HAL and conceived as a replacement for its large and antiquated inventory of MiG-21s has faced inordinate budget overruns and delays and has been insufficient in addressing inventory attrition. Self-reliance in defense production is in every country’s national interests, but routine platitudes favoring self-reliance without providing for adequate investments in research and development, incentivizing the growth and maturation of a robust technical and industrial manufacturing base, or liberalizing the defense industry, have created conditions for incredible inefficiencies and a perpetually anemic domestic defense sector incapable of meeting India’s defense needs. Successive Indian governments have prioritized the dogmatic pursuit of indigenization over the need to plug critical national security gaps.

The LCA experience is a case in point. In 1983, the Government of India, taking cognizance of its aging fleet of MiG-21s and a series of combat aircraft crashes (there were 482 MiG-related crashes resulting on 171 pilot deaths between 1971-2012 in India), commissioned a replacement project in called “Development of the Light Combat Aircraft.”

The project has taken 31 years to translate vision into some semblance of reality due to a myriad off actors: bureaucratic inefficiencies, limitations in technical expertise, lack of adequate infrastructure and testing facilities and unavailability of critical components due to the technology denial regimes of other countries. Opting to develop a domestically-built engine (Kaveri) for the LCA ended in disaster; after 24 years and investments of about $600 million, it was eventually determined to be unfit for the LCA in 2013 and replaced with General Electric’s F404 engine. Technical advances and India’s changing strategic environment have meant that LCA’s requirements have had to be redefined repeatedly, which have resulted in further delays.

The MMRCA and LCA experiences are merely symptomatic of the larger defense planning malaise that continues to plague India. After the 1999 Kargil War, the National Democratic Alliance-led government commissioned a study (resulting in the Kargil Review Committee report) that highlighted deficiencies in India’s security management apparatus. A Group of Ministers (GoM) Committee, chaired by then-Deputy Prime Minister LK Advani, was then constituted to study the need to reform India’s national security system. The committee in its report recommended a “comprehensive systemic overhaul of the country’s security and intelligence apparatus” and identified that:

  • The system governing defense acquisitions suffered from a lack of integrated planning, weaknesses in linkages between plans and budgets, cumbersome administrative, technical and financial evaluation procedures, and an absence of a dedicated, professionally equipped procurement structure within the MoD.
  • No congruence existed between India’s national security objectives, its defense objectives, defense policy and directives for the Defense Minister.
  • The defense planning process was greatly handicapped by the absence of a national security doctrine and commitment of funds beyond the financial year. It also suffered from a lack of inter-service prioritization and flexibility.
  • There was dysfunction between technology planning and development and coordination between R&D (e.g., DRDO), production agencies (e.g., HAL) and users (e.g. IAF).
  • There was also no synergy between academic research and Government’s requirements. Academic research is carried out more or less in a policy vacuum.
It is unfortunate that successive governments in India haven’t gone about addressing these issues with any level of assiduity 14 years after the committee issued its findings and recommendations. Subsequent studies on higher defense management such as the Naresh Chandra Committee report continue to gather dust and remain classified. Under the circumstances, the ad-hocism and inefficiencies that feature prominently in the MMRCA deal and the LCA project are unsurprising. The proposed purchase of 36 Rafale combat aircraft from France, if the deal does indeed go through, may ease momentary suffering but treats, at best, one part of one symptom and not the root cause itself.

Lessons for India: How the ‘Mother of All Defense Deals’ Crashed and Burned | The Diplomat
 
Think about it. Its a mind boggling planning that only India could pull off.

Looking for a fighter jet under MMRCA banner since 2007. Selected a jet in 2012. Negotiated for it for 3 years to build them in their country. Then bought them fully built from supplier. The first deliveries expected in 2018. A full 11 years wasted in which they could have got at least 70 jets.

As soon as Modi left France, French would have laughed their but*s off! No surprises there for such an expression.
 
Think about it. Its a mind boggling planning that only India could pull off.

Looking for a fighter jet under MMRCA banner since 2007. Selected a jet in 2012. Negotiated for it for 3 years to build them in their country. Then bought them fully built from supplier. The first deliveries expected in 2018. A full 11 years wasted in which they could have got at least 70 jets.

As soon as Modi left France, French would have laughed their but*s off! No surprises there for such an expression.

Their faces will become pale if they knew about the number stands at 36!
 
Their faces will become pale if they knew about the number stands at 36!

Even 36 is a success for France and to an extend for Dassault, because the French government can save a lot of money by selling Rafales in times of tied defence budgets and at the same time can safe jobs in the industry around Dassault and the Rafale. And even for Dassault, getting a 2nd export alone would be a PR win, but with the "intend" to buy 36, we gave them basically the assurance to buy at least some more, even if not 126.
The only loser with this decision is India, because the PM gave away the high position in the negotiations with Dassault / MMRCA vendors, can't provide the IAF with the needed number of fighters and can't get the industry with anything useful anymore.
As I said before, or as the former Air Chief Marshal Fali Homi Major said in the interview above too, getting 36 in a fast procurement is only good if it's part of the larger MMRCA deal. But if that's all, or the major part of what the PM now wants to buy, it's "a ridiculous step" and we have to accept that people laugh about us.
 
Even 36 is a success for France and to an extend for Dassault, because the French government can save a lot of money by selling Rafales in times of tied defence budgets and at the same time can safe jobs in the industry around Dassault and the Rafale. And even for Dassault, getting a 2nd export alone would be a PR win, but with the "intend" to buy 36, we gave them basically the assurance to buy at least some more, even if not 126.
The only loser with this decision is India, because the PM gave away the high position in the negotiations with Dassault / MMRCA vendors, can't provide the IAF with the needed number of fighters and can't get the industry with anything useful anymore.
As I said before, or as the former Air Chief Marshal Fali Homi Major said in the interview above too, getting 36 in a fast procurement is only good if it's part of the larger MMRCA deal. But if that's all, or the major part of what the PM now wants to buy, it's "a ridiculous step" and we have to accept that people laugh about us.

But if(there are high chance for follow up orders) just 36 fighters will save their jobs? No! the delivery will be finished in 2-3 years and that it. As the details of the the 36 jet deal yet to come out. It is, in a way, a bad PR to them as an emerging India can't buy them in high numbers, how come the others buy?

We will have to wait and see about it, I'm sure there are more details to come out or we will see more M2Ks in IAF as a part of the deal.
 
Defence Indigenisation Riddle Must be Solved
By Manmohan Bahadur

The Rafale saga has thrown up new twists in its meandering and tortuous journey since January 2012 when it was selected as the successful bidder for the IAF’s MMRCA “mother of all deals”. The announcement of the prime minister in Paris that India would procure 36 Rafales via a government-to-government route has been the latest turn and has thrown open the question of the relevance of the “Make in India” drive. It is good that the government has shown political guts to break the logjam and give the IAF “minimum oxygen”, as defence minister Manohar Parrikar put it; however, it raises a few niggles regarding the path that would be taken to follow up on the defence indigenisation drive, of which “Make in India” is just a subset.

“We want peace from a position of strength and not from one of weakness,” the defence minister had said at a seminar in Delhi last month. The seminar, meant to throw up ideas for increasing India’s embarrassingly minuscule defence exports, ended up no different from the multitude of previous such events. There was a litany of oft-heard grievances and how nothing has changed; illustrative of the anguish in the private industry was the statement of a CEO that “everything is still licensed, except the licence.” And, as usual, the government was absent, barring two officials, who too left before the Q&A section. To be fair, the defence minister announced that a revised Defence Procurement Procedure (DPP) would be promulgated soon. Unfortunately, the DPP is only part of the problem as the malaise affecting manufacturing of true indigenous defence products lies elsewhere.

“The only thing harder than getting a new idea into the military mind, is to get an old one out,” military historian Liddell Hart had said. In the Indian context, it extends to the babudom, which controls military manufacturing policy. Nobody wants to let go of the power that comes with archaic rules that stifle local private industry and land up benefitting foreign manufacturers. If PM Modi’s “Make in India” is to succeed, defence manufacturing should be the prime target for the government, as that is where the low-hanging fruit lies.

A misperception that afflicts us all is the fallacy that only big-ticket items, the likes of MMRCA and T-90 tanks, constitute defence manufacturing. An analysis will show that there are enough low-value (relatively) but high-volume items that can kick-start the “Make in India” effort; in fact, there may be many for which we have paid for the Transfer of Technology (ToT) but have forgotten about them, a la the 155mm Bofors artillery gun saga! Let realism govern our thinking, for, if the secretary, department of industrial policy and promotion says (as he did at the seminar) that of their total production HAL exports only 2 per cent, Bharat Electronics 3.5 per cent and ordnance factories only 0.19 per cent, while we import 70 per cent of our armament requirement, shouldn’t we be thinking of first becoming a defence manufacturer?

The answer to the problem lies in the comment of the second government official present at the seminar who rued that rules do not permit export licences! But who makes rules, if not the government? If any progress is to be made, just two basic administrative decisions are necessary—all else will follow. Firstly, ownership of defence indigenisation should be fixed, and secondly, the Defence Offsets Management Wing (DOMW) should be drastically reformed.

“Ownership” of the indigenisation process rests in a body that makes indigenisation policy and analyses whether it is being implemented. This entity, thus, becomes accountable; that’s where the ownership of the process should lie. Presently, is it the department of defence production or DG (acquisition) or is it the MoD as a whole? Can these behemoths be penalised when the rapid turnover of office-bearers is governed by promotion policies of sequential appointments—“aaya ram, gaya ram” to use a political jargon? The fact that severe censure from innumerable Parliamentary Committees on Defence has not derailed any bureaucrat’s career is proof that no one has ownership. Thus, one marks one’s year or two in the MoD, pushes files and moves on—indigenisation stays where it is, and so does the nation.

What happens elsewhere? In the US, there is a Defence Acquisition University that was born from the ills of what their defence historian William Gregory described as the acquisition system being one that had been “managed and over-reformed into impotence with volumes of oversight regulations”. He observed that their Congress had been pursuing an impossible dream by trying to legislate perfection when “no regulation could create good management or top-notch people”. The result was the setting up of a permanent Defence Acquisition Corps that ensures continuity “from cradle to grave” of a project. In UK, their MoD has an integral civil services permanent cadre that follows through to ensure continuity. So, what should India do? As a start, create an empowered body and post quasi-decision takers (joint secretary-level officers) of ALL ministries concerned (taxation, excise, industrial production et al) under one roof and under one boss. Call him/her DG Defence Indigenisation or whatever, but ownership has to rest there—it would be his/her success or failure. They should have a fixed tenure of four-five years (not less) and it should be clear to them that indigenisation results would determine further career progression. As a parallel, the government should fast-track defence acquisition training at the soon-to-be set-up National Defence University to produce acquisition professionals.

It will be at least a decade, despite all the honest efforts of this government, before any semblance of a defence manufacturing base is visible on ground. Till then, India will continue to import heavily and herein comes the second recommendation. It is vital that the DOMW squeezes technology worth every cent of the USD 100 billion-130 billion of defence offsets that are expected to flow, and for which we have paid dearly. But, one has to be an eternal optimist to believe that just the 10 personnel (also with limited tenures), who presently constitute DOMW, can deliver! If we do not radically reform DOMW now and make it, first potent and then accountable, the seminars will continue to be what they are now—just good “time pass, with a sumptuous meal thrown in”.

Defence Indigenisation Riddle Must be Solved -The New Indian Express

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Eye on the Future

The Rafale deal will boost Indian manufacturing in the long run.
Goutam Das Edition:May 10, 2015

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The Indian Air Force's (IAF) quest for a modern fighter jet involved a long-drawn acquisition process lasting more than a decade and logjam in negotiations. However, the end, when it came, was unexpected, and swift.

When Prime Minister Narendra Modi said in Paris on April 10 that India will buy 36 Rafale jets from Dassault Aviation in the "ready-to-fly" mode, many accused the government of sacrificing its 'Make in India' dream at the altar of convenience.

While it's true that the original deal for Medium Multi Role Combat Aircraft (MMRCA), which seemed to be headed nowhere, involved purchase of 18 fighters in a "fly-away condition" and making of the rest by state-run Hindustan Aeronautics (HAL), critics of the latest deal may be overreacting.

"The delay had created ill will. Giving Dassault double the original order of 18 is a good way to break the stalemate," says Amber Dubey, Partner and Head of Aerospace and Defence, KPMG India.

India, say many experts, has a lot to gain from the deal in view of the IAF's depleting strength and promise of domestic manufacturing in the form of offsets, joint ventures and contracts for purchase of components.

When inducted into the IAF in two years, Rafale will be India's most advanced fighter. "The deal addresses the IAF's immediate requirements," says Air Marshal M.Matheswaran, who retired in March last year as Deputy Chief of Integrated Defence Staff. The IAF's fighter strength now stands at 34 against a sanctioned 42 squadrons. "The government will now get time to address Make in India issues," he says.

Though the details are not known yet, either this deal or follow-on deals should have a 'Make in India' component. Analysts say this is a "sweetener" deal with a lot of give and take opportunities in the future. "There could be transfer of technology, more collaboration and use of India as a global supply base for Dassault products. Dassault can also set up a joint venture here. That would be real 'Make in India'," says Dubey of KPMG.

Rahul Gangal, Partner, Roland Berger Strategy Consultants, says the deal will create offset opportunities for Indian companies. The offset policy was introduced as part of the Defence Procurement Procedure 2005.

Most defence deals signed by India with foreign companies have an offset clause under which the foreign supplier has to procure a big chunk of inputs - 30 per cent to 50 per cent depending on the deal - from local suppliers. Till date, 24 offset contracts amounting to $4.87 billion have been concluded.

Some analysts project an offset opportunity of $3.2 billion for Indian manufacturers if the government goes ahead with a follow-on order for another 36 jets - which is 72 Rafale jets in all. According to some industry watchers, there is a possibility this could happen.



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Air Marshal Matheswaran says the cost of each jet was "guesstimated" at $70-80 million when the request-for-proposal was being prepared. Analysts now peg it at $90 million.

This implies payment of $3.2 billion for 36 jetsand $6.4 billion for 72. The best-case scenario in offsets opportunity is $3.2 billion, where nearly 50 per cent is sourced from Indian vendors. Some of India's big manufacturing houses could be in business. Dassault had already identified its sourcing partners when the previous Rafale negotiations were on.

"It will be a great opportunity for 'Make in India'," says Gangal. "You will get global aerospace and defence supply chains to set up supply bases and capability in India. While this one is a 'fly-away' deal, for Dassault, India is now a primary entity in the portfolio. It will develop the local industrial base in the hope of negotiating the next big deal," he says.


The best-case scenario in offsets opportunity is $3.2 billion, assuming 50 per cent is sourced from Indian vendors

India's quest for a modern fighter has a long history. The request for information for the aircraft came in 2001, tenders for a competitive bid were issued in 2007. In 2012, Rafale edged out Eurofighter Typhoon jets after emerging as the lowest bidder. But the negotiations made little headway after that. It is believed that the cost of making these fighters changed drastically after 2007. Also, India pushed Dassault to take complete ownership of the 108 fighters HAL was to make. Dassault, as was expected, resisted.

Realising that the country could not wait forever for modernising its air force, India directly negotiated with the French government and signed the deal, prompting critics to claim "an unexpected knockout victory" for Dassault as it will not have to transfer technology now. Some called the decision arbitrary and questioned the French jet's performance.

Some even questioned the "handing out of billions to a French company that is struggling to survive." In 2014, the company's sales fell 20 per cent to €3.68 billion while profits fell 18 per cent to €398 million. On April 9, the day before Modi announced the deal, its stock closed at €1,142 on the Euronext. On April 15, it was at €1,224. Investors are perhaps viewing the deal as a lifeline for Dassault.

While India has "given", all eyes are now on the "take" part of the equation. The French have been supplying military hardware to India for quite some time now. Hyder Ali, the Sultan of Mysore (1721-1782), received French equipment to fight the British. Perhaps the French will now look at India differently, beyond its large market.

Rafale jet deal to boost Indian manufacturing in long run - Business Today

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French Def Min Visit to Clear Air on Rafale
By Pradip R Sagar

Published: 23rd April 2015 05:59 AM
Last Updated: 23rd April 2015 05:59 AM

NEW DELHI: Nearly a fortnight after the government’s decision to buy 36 ready-to-fly Rafale fighter jets, a top-level French delegation headed by Paris’ Defence Minister will be coming down here shortly to discuss the modalities of the procurement.

According to a top official, the French government has approached the South Block, which houses the Ministry of Defence (MoD), seeking an early appointment for holding delegation-level talks to take the deal forward.

Prime Minister Narendra Modi, during his Paris visit on April 10,had made an announcement saying, “In view of the critical operational necessity for Multirole Combat Aircraft for the IAF, Government of India would like to acquire 36 Rafale jets in fly-away condition as quickly as possible from the Government of France.”

And the following day Defence Minister Manohar Parrikar had clarified that the procurement of these 36 fighter jets will be through Government-to-Government route with the two sides holding detailed negotiations on the project. “As the decision has been taken at the highest level, the two sides will have to sit together to discuss the further course of action. From the price to the fighters’ maintenance and offset, all terms and conditions need to be discussed at length. French government has expressed its intentions to start the negations quickly for timely delivery of aircraft,” said a top official of the South Block.

French Def Min Visit to Clear Air on Rafale -The New Indian Express
 

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