Rafale CAG re­port to be tabled soon

Hindustan Times (Delhi) - - HTNATION - Ra­jesh Ahuja ra­[email protected]­dus­tan­times.com

NEW DELHI: The Comptroller and Au­di­tor Gen­eral of In­dia (CAG) will likely sub­mit to the Pres­i­dent on Mon­day a much-awaited re­port on its au­dit of big-ticket mil­i­tary pro­cure­ments in the last few years, in­clud­ing the con­tro­ver­sial Rafale jet fighter deal, of­fi­cials fa­mil­iar with the de­vel­op­ment said on Satur­day.

“Re­port is ready to be sub­mit­ted to the Pres­i­dent. A copy of the re­port will be sub­mit­ted to the gov­ern­ment as well. The Pres­i­dent will for­ward the re­port to the pre­sid­ing of­fi­cers – speaker of Lok Sabha and chair­man of Ra­jya Sabha – who will lay it in the Par­lia­ment,” a gov­ern­ment of­fi­cial said on con­di­tion of anonymity.

Given the short time frame, the re­port is likely to be tabled in the Par­lia­ment on Wed­nes­day, the last day of the last ses­sion of the 16th Lok Sabha be­fore gen­eral elec­tions due in the spring, the of­fi­cial said.

Of­fi­cials in the CAG ex­plained that it was a per­for­mance au­dit wherein the CAG looked into pro­cure­ment sys­tems. “As is the case with all au­dits, it also started with an “En­try Con­fer­ence” wherein the au­di­tee was in­formed of the scope and ob­jec­tive of the au­dit and how the teams of au­di­tors are go­ing to col­lect sam­ples for sur­vey. The en­try con­fer­ence is­the ini­ti­a­tion point of an au­dit,” said a CAG of­fi­cial who also re­quested anonymity.

Fol­low­ing the au­dit, an exit con­fer­ence also took place and it was presided over by the di­rec­tor gen­eral of de­fence au­dit, which is con­sid­ered a field of­fice of CAG.

Ac­cord­ing to the au­dit guide­lines of the CAG, an exit con­fer­ence serves as a plat­form to ar­rive at an agree­ment with an au­di­tee about au­dit con­clu­sions and rec­om­men­da­tions; an at­tempt is made to get the au­dited en­tity to re­spond di­rectly to each rec­om­men­da­tion so that the re­sponses can be pub­lished in the fi­nal au­dit re­port.

As far as the Rafale deal is con­cerned, the process of buy­ing 126 fighter jets for the In­dian Air Force (IAF) be­gan in June 2001 when the pre­vi­ous Na­tional Demo­cratic Al­liance (NDA) gov­ern­ment un­der Atal Bi­hari Va­j­payee was in of­fice. Un­der the orig­i­nal pro­posal, 18 war­planes were to be pro­cured in a fly-away con­di­tion and the re­main­ing 108 air­craft were to be man­u­fac­tured by sta­te­owned Hin­dus­tan Aero­nau­tics Lim­ited (HAL) un­der li­cence.

The bid­ding process com­menced in Au­gust 2007, when the Congress-led United Pro­gres­sive Al­liance (Upa)was in of­fice, but it was com­pleted only five years later when Das­sault Aviation of France, the maker of Rafale fighter planes, emerged as the front-run­ner ; the gov­ern­ment started ne­go­ti­a­tions with the com­pany which went on un­til 2014, when the UPA gov­ern­ment lost elec­tions and a new NDA dis­pen­sa­tion took charge un­der Naren­dra Modi.

The NDA gov­ern­ment’s de­ci­sion to en­ter an $8.7 bil­lion gov­ern­ment-to-gov­ern­ment deal with France to buy 36 Rafale war­planes was fi­nally an­nounced in April 2015, with an agree­ment signed a lit­tle over a year later. This re­placed the Upa-era de­ci­sion to buy 126 Rafale air­craft.

The deal has be­come con­tro- ver­sial with the op­po­si­tion, led by the Congress, claim­ing that the price at which In­dia is buy­ing Rafale air­craft now is ~1,670 crore for each, three times the ~526 crore, the ini­tial bid by the com­pany when the UPA was try­ing to buy the air­craft. It has also claimed the pre­vi­ous deal in­cluded a tech­nol­ogy trans­fer agree­ment with HAL.

The NDA has not dis­closed de­tails of the price, but the UPA deal, struck in 2012, was not a vi­able one, for­mer de­fence min­is­ter Manohar Par­rikar has pre­vi­ously said, im­ply­ing that it would have never been closed and that, there­fore, any com­par­i­son is moot. In­deed, the UPA was not able to close the deal till 2014, largely over dis­cus­sions re­lated to pric­ing of items not in­cluded in the ini­tial bid.

The deal has also be­come con­tro­ver­sial on ac­count of the fact that one of the off­set deals signed by Das­sault is with the Re­liance Group of Anil Am­bani. The Congress claims the ear­lier deal was scrapped and a new one signed just to pro­vide Am­bani this op­por­tu­nity for an off­set deal. Both the gov­ern­ment and Re­liance Group have re­peat­edly de­nied this.



Ra­jeev Ku­mar

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