Deadlock over India’s Rafale purchase has been broken after the Defense Acquisition Council (DAC) gave a go ahead for further negotiations to buy 36 fighter jets.
According to sources, the French proposed 8 billion Euro earlier for the deal. It might possibly come down with the price and also agree an offset clause that requires France to invest 50 per cent of the value of contract in India. France has softened its stand after a political intervention by both governments.
So far, the agreement was delayed due to differences over offsets and price of the twin-engine fighter.
The unit price of the 36 Rafale aircraft was 25 percent higher than the $200-million price tag offered to the Indian prime minister during his April visit to France.
Sources quoted in the French media last week reported that higher price was because the Indian Air Force (IAF) was asking for a different set of armaments than what was proposed under the earlier RFP route and that Indian wanted offsets which would push up the final cost.
The DAC approval comes after the negotiation committee briefed the DAC about the progress so far. The agreement will be signed when both negotiation teams agree on the purchase agreements.
The negotiating committee is considering the 50 per cent offset requirements, as well as the arms and equipment the fighters will be fitted with.
France and India are expected to sign an inter-governmental agreement on the purchase of the Dassault Rafale fighter aircraft next week. French Defense Minister Jean-Yves Le Drian is expected to arrive in Delhi August 31 and will hold talks with his Indian counterpart Manohar Parrikar before signing the inter-governmental agreement on Tuesday, various media reported
Indian and French teams discussing the Dassault Rafale fighter jet purchase could wrap up their discussions within the next fortnight. According to informed sources, the talks are progressing and a draft agreement could be hammered out as early as the first week of September
India may opt for off-the-shelf purchase of three squadrons of the Russian T-50 fifth generation stealth fighters, instead of taking the earlier Joint R & D route to manufacture 127 fighters in India. Just as the Indian MoD abandoned discussions for licence-manufacture of the Rafale in India and went in for direct procurement of three squadrons, it may do the same in case of the T-50 for speedier procurement
The sudden decision by French Defense Minister to cancel a planned visit to India on his way back from Malaysia is an indication of all is not well in the negotiations of the 36 Rafale fighter jets sales to India. The defense minister Jean-Yves Le Drian who was to arrive in New Delhi on September 2 to sign an inter-governmental deal on the purchase of 36 Rafale fighter jets cancelled his plans at the last minute
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