The 7.87 billion Euro agreement between India and France for the 36 Rafale fighter jets comes with a 50% offset clause which means that Indian companies will get business worth over 3 billion euros and generating thousands of jobs in India through offsets. (Reuters)
A decade after then defence minister AK Antony approved the Request for Proposal to buy 126 Medium Multi-Role Combat Aircraft, the Indian Air Force will get its first Rafale fighter jets in the next 33 months from French company Dassault Aviation. The 36 aircraft that the IAF will get will replace the ailing MiGs. The first plane will be delivered within three and half years, and the entire lot in five years.
The 7.87 billion Euro agreement between India and France for the 36 Rafale fighter jets comes with a 50% offset clause which means that Indian companies will get business worth over 3 billion euros and generating thousands of jobs in India through offsets. This is reportedly the largest ever offset contract in India’s history.
This clause is expected to boost indigenous defence production with transfer of technology, joint ventures with local partner firms, licensed production and even perhaps relocation of production lines in the long run.
“The offset clause of 50% in the Rafale deal will provide a great opportunity for indigenous manufacturers such as us who have put in years of effort to develop world-class technology within the country,” says Puneet Kaura, MD and CEO, Samtel Avionics. “It further outlines the commitment made by the Indian government to promote the Indian manufacturing industry and support indigenisation of defence needs of the country.
There is also a possibility for India to become a global manufacturing hub for these fighter planes in case there is successful transfer of technology.”
Since Dassault Aviation Company was not keen on transfer of technology, under the 50% offset clause,
it has agreed to help India with the Light Combat Aircraft MK 2 and AMCA.
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French company Snecma (Safran)( a Dassault partner along with Thales) has proposed to invest Euro one billion in the Kaveri Gas Turbine Engine to be fitted in the LCA MK1A. Safran has developed the M88 engine that powers the Rafale as well as the Shakti engine for Indian advanced light helicopters (ALH) ‘Dhruv’.
MBDA will work with Defence Research and Development Organisation (DRDO) to transfer Thrust Vectoring technologies that are expected to be used in Astra and other missiles putting them at the level of Meteor—making the missiles more lethal.
Under the deal, the French company has agreed to transfer the special spray paint and coating technology which is of immense benefit to Indian programmes, including LCA, AMCA, SU-30 MKI and FGFA.
Also, it is expected that 36 combat machines could get the final layer of the stealth paint here in India as part of Make in Indiainitiative.
The radar technology on Rafale can easily be adapted to other aircrafts in IAF. As part of the deal, the multimode AESA radar technology will be transferred to DRDO for application on UTTAM AESA radar.
The high-end twin engine aircraft with a state-of-the-art electronic scanning radar will certainly add to the IAF’s capabilities. The MBDA’s new-age Meteor Beyond Visual Range missile, can hit targets over 150 km away, without entering the enemy airspace before launching an attack. The aircraft is also capable of firing nuclear missiles.
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Finally its out in public domain
- LCA MK2 and AMCA Help
- Safranised Kaveri to be fitted in LCA Mk1A
- Thrust Vectoring to Astra
- RAM coating and technology behind it for application to LCA, AMCA, Su30 MKI and FGFA
- RBE2 AESA tech and code and application to all IAF inventory (a direct competition to 2052) via TOT to Uttam AESA
So long we kept saying the same..
I like the line when Newspaper says DA is not keen for TOT and yet it gives all this as part of the offsets.. I hope they were not expecting to part it for free rather now with so much deep inroads via such MIC level cooperation and making the ecosystem ready for a cutting edge fighter plane manufacturing, it serves the very purpose we all wanted to begin with.
The question to wonder is with so much cooperation why would India, France and Dassault stop at just 36. And if suppose thats the reality that its just say 36 so for say 90 odd jets how much a single engine aircraft like LWF has to give as part of the technology and priceto better the deal as its now a benchmark along with legacy MKI deal for HAL.
A nice start to the week.. Enjoy
@Abingdonboy - Its as per what we discussed - LCA and AMCA .. Safranised Kaveri for Mk1A. You will see uprated Kaveri too going into AMCA. In a way its now a gamechanger for India bcz other manufacturers have to offer a Engine tech in full to entice India into buying or shell out other goodies with re engine option.. Its gonna make life very difficult for LWF folks
This is a classic case of people seeing what they want to see.
But these are what the article EXPLICITLY states.
1. Of 7.87 Billion Euro, ONLY 3 Billion $ will be DEEMED invested in India. This is even less than 40%.
Its only 38%. THIS is the real value of the Offset. (on paper). NOT Actually invested, ONLY Deemed Invested.
2.
Dassault Aviation Company is not keen on transfer of technology, under the 50% offset clause. and setting up production in India.
3. Govt. of India had to WORK AROUND this reluctance and find a different solution.
4. Snecma will now CLAIM credit of 1 billio $ after helping Kaveri come to fruition. This will not be any Actualy investment of 1 billion $ in Real money.
5. Dassault will be able to CLAIM 1 billion $ WHEN the Kaveri becomes ready after its help. So any actualy job creation will be only AFTER the Kaveri is compelted, Certified, Fitted on the aircraft, Aircraft then certified AND THEN when production begins. A good 8-10 years in the future.
6. Production will be in HAL so any jobs created will be in HAL.
7. MBDA will transfer tech to Astra and then Dassault can then CLAIM an offset of couple of hunder million $.
8. Again ANY job creation will be AFTER the missile is tested, certified, accpted by AF and THEN productin beings. Only this job creation will ALSO be in Bharat Dynamics, another PSU.
9. Spray Paint and coating technology will be transferd (Probably to HAL or maybe Reliance) and then Dassaut can again CLAIM offset for a coupld of hundred million $. Again NO ACTUAL INVESTMENT will be made by Dassault.
10. All in all the 'Offset' will allow for limited Tech transfer but will result in MINIMAL Dassault money being invested in India. ANY and All investements will be by Indian companies.
11. Any job creation will be in hundres not in thousands and most of them will be in PSU. Even then the priority will be to Re-Train existing staff, so it is unlikey any new jobs will be created.
12. These Offset will not be any real Monetary Investment, it will only be ToT of deemed equivalent and Claimed by Dassault.
13.
Finally This makes it perfectly clear that No more Rafale will be purchaased . ALL ToT will be for existing Indian projects Like LCA, Astra and Kaveri (Maybe AURA), not to build any more Rafale.
I hope NOW the 'fan boys' can get this through their thick skull and finally stop this public masturbation for more Rafales.
MII of Rafale is going to happen, now point is when ?
Delivery of 36+18 will take time to complete by 2022
LOL.... NO MII of Rafale is going to happen. Ever.
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