The Rafale Saga

The Indian government’s decision to purchase 36 Rafale fighter jets continues to be shrouded in controversy. There are now allegations that the deal is marked by overpricing and crony capitalism. But is the controversy more political than economic? Is it a storm in a teacup?

- Prakash Nanda

The saga of Rafale in India, more than a decade now, has now been embroiled in the country’s highly competitive domestic politics, with the principal opposition Congress party, let alone the other critics, alleging “huge scam” in the procurement of 36 medium multi-role combat aircraft (MMRCA) Dassault Rafale fighter jets, as concluded by the Modi government in 2015. Congress President Rahul Gandhi has led the allegations in recent times, most notably during the electioneering in Gujarat.

In essence, the Congress (through Rahul Gandhi and the official spokesperson Randeep Surjewala) has five issues with the deal that was officially signed on September 23, 2016, though it was announced by Prime Minister Narendra Modi in April 2015 at Paris during his visit to France. One, the deal did not undergo established official Defence Procurement Procedure (DPP). Two, the Modi government violated and bypassed the interests of Hindustan Aeronautics Limited (HAL), which was supposed to co-produce the fighter planes as per the original Agreement in 2012, as made by the Congressled UPA government. Three, while the Modi-government signed the $8.7 billion deal, costing each plane ₹1570 crores, as per the UPA negotiated price, the cost of one plane was ₹526.1 crores. Fourthly, the deal seems to have been made not to benefit the Indian Air Force (IAF) but the “crony capitalist” Anil Ambani’s Reliance Defence. Surjewala finds it intriguing that “while India signed the $8.7 billion deal on September 23 last year, just 10 days later, on October 3, 2016, Reliance Defence Limited entered into a joint venture with the French fighter plane maker Dassault” without any clearance from the government.