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India, France ink deal for 36 Rafale fighter jets

The Indian government inked a Euro 7.87 billion (approximately Rs 59,000) deal with France for purchase of 36 Rafale fighter jets capable of carrying nuclear weapons and equipped with the latest missiles that will give the IAF greater "potency" over arch rival Pakistan.

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The Indian government inked a Euro 7.87 billion (approximately Rs 59,000) deal with France for purchase of 36 Rafale fighter jets capable of carrying nuclear weapons and equipped with the latest missiles that will give the IAF greater "potency" over arch rival Pakistan.

The Rafale combat aircraft to be manufactured by French aviation company Dassault will come with various India-specific modifications including Israeli helmet mounted displays, radar warning receivers, low band jammers, 10 hour flight data recording, infra-red search and tracking, towed decoy systems among others.

The Inter Governmental Agreement was signed by Defence Minister Manohar Parrikar and his visiting French counterpart Jean Yves Le Drian 16-months after Prime Minister Narendra Modi announced India's plans to buy 36 Rafale fighter aircraft in fly away condition during his trip to France.

The contracts for the deal were also signed earlier in the day.

The 'vanilla price' (just the aircraft alone) will cost about 91.7 million Euros each for a single seater and about 94 million Euros for a two-seater trainer aircraft.

"Pleased to inform that India has signed an agreement for procurement of 36 Rafale aircraft with weapon systems, five years complete spares and maintenance, performance based logistics, India specific special provisions. This is an achievement which will give the IAF the required potency in terms of penetration and capability," Parrikar told reporters at the South Block.

The deal, first fighter plane contract in 20 years, comes with an immediate saving of 328 million Euros over the one struck during the previous UPA government, which was scrapped by the Narendra Modi government, besides a 50 per cent offset clause.

The 50 per cent offset clause means that Indian businesses, both big and small, will gain work to the tune of over three billion Euros.

With the Rafale deal clinched, Dassault Aviation CEO Eric Tappier said the French company is ready to be part of 'Make in India' initiative and open to manufacturing the fighters in India if the plane is shortlisted for a bigger order.

These combat aircraft, delivery of which will start in 36 months and will be completed in 67 months from the date the contract is inked, comes equipped with state-of-the-art missiles weaponry that will give IAF a capability that had been sorely missing in its arsenal.

The features that make the Rafale a strategic weapon in the hands of IAF, which is currently down to 34 squadrons as against a sanctioned strength of 44, includes its Beyond Visual Range (BVR) Meteor air-to-air missile with a range of 150 KM.

Its integration on the Rafale jets will mean IAF can hit targets inside both Pakistan and across the northern and eastern borders while staying within India's territorial boundary. The Rafales will be stationed at two bases--Sarsawa in Haryana and Hasimara in West Bengal.

Pakistan at present has only a BVR with 80 km range.

During the Kargil war, India had used a BVR of 50 km range while Pakistan had none. However, Pakistan later acquired 80- km-range BVR.

Defence experts said that with 'Meteor' the balance of power in the air has again tilted in India's favour.

'Scalp', a long-range air-to-ground cruise missile with a
range in excess of 550 km, also gives IAF an edge over its adversaries. Both missiles have a 2 metres precision which means that a target can be hit with high precision.

Defence Ministry sources said the Rafale, which has a range of 780 to 1055 km, depending on mission role, as compared to 400-450 of the Su30, will be better than what even the French uses as it will have numerous India specific additions.

Moreover, the Rafale wil have one and half times greater loitering capability than the Su-30, sources said.

They added that Rafale would be able to do five missions per day as compared to three for other aircraft because of high turnaround time.

For example, the engine of the Rafale can be replaced in 30 minutes as compared to 8 hours for the Su30.

The "vanilla price" or the bare bone price of the 36 aircraft is about 3.42 billion Euros. The armaments cost about 710 million Euros while Indian specific changes, including integration of Israeli helmet-mounted displays, will cost 1,700 million Euros.

Associate supplies for the 36 fighter jets will cost about 1,800 million Euros while performance based logistics will cost about 353 million Euros.

Rafale is a multi-role fighter aircraft capable of undertaking all types of missions with a capability to simultaneously perform both air defence and ground attack role in a single mission.

The tough negotiations by the MoD-IAF team extracted many concessions and discounts from the French before arriving at a price that is almost 750 million Euros less than what was being quoted by the French side in January 2016.

This was when the commercial negotiations gathered pace.
The French side had quoted a price of 8.6 billion Euros in January following which India refused to sign the contract.

This forced both the countries to just sign an MoU in January, when French President Francois Hollande came, announcing their intention to sign an IGA.

To bring down the cost, the Indian side asked French officials to calculate the deal on actual cost (Price as on today) plus European Inflation Indices.

The Defence Ministry has capped the European Inflation Indices to maximum 3.5 per cent a year. In other words, if inflation Indices goes down, India will have to pay less. Even if it goes up India will not pay more than 3.5 per cent increase, sources said. 

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