Actually they evaluated 10 different fighters during the MRCA and the MMRCA competition in roughly a decade now (Gripen C/D and NG, F16 B52 and IN, Mig 29SMT and 35, Mirage 2000-5 and Rafale, EF, F18SH).
IAF reportedly wanted the fast replacement with M2K-5s, but MoD seems to have different things in mind (maybe fueled by the industry, that LCA might be ready soon, who knows), the MMRCA needed actually 5 years from RFP to decision stage and now we waited for 1.5 year for the signature of the contract, problematic part and has mainly to do with Dassault fulfilling the offset and ToT requirements, final negotiations about this and that...
I am frustrated about this delays too, but we defenitely have made the right choice with Rafale and imo also with considering the newer versions and fighters.
If we would have taken the M2K-5s back then, we might have them fully inducted by now and replaced more of the Mig 21s, but the upgrade potential of the fighter would be limited and technically would even be surpassed by LCA MK2 pretty fast. Rafale on the other hand will remain with a credible edge, which makes the expenses in this fighter and the higher industrial advantages of the new competition more beneficiary. The only problem that I see is, that we stick to the lenghty licence production deal, instead of getting more directly from France to induct them faster. I hope we go for the optional right away and get 2 more squads therefor from them.