Rafale price details given to SC, govt says rules followed
IT ISN’T CLEAR IF PRICE REVEALED IS OF COST WITHOUT WEAPONS AND INDIASPECIFIC ENHANCEMENTS, OR THE COST OF THE FULLY LOADED, MADEFORINDIA AIRCRAFT
NEW DELHI: The Government of India revealed in a sealed cover to the Supreme Court on Monday the pricing details of the controversial deal to buy 36 Rafale jets from France and also shared with petitioners questioning the deal a redacted version of a report submitted to the top court last month detailing the decision-making process that led to the purchase.
A government official familiar with the matter confirmed that the government has “given all details pertaining to the pricing of Rafale jets to court as it was felt that the prices could be revealed to Supreme Court judges.”
It isn’t clear whether the price revealed is that of the basic cost of the aircraft without weapons and India-specific enhancements, or the cost of the fully loaded, made-for-india one.
A team of Indian negotiators set up to buy 36 Rafale fighter jets got a better deal on price and maintenance of the planes as compared to the earlier offer from French firm Dassault Aviation, according to the decisionmaking report, which also added that there was no mention of a private business house when it came to the offset part of the deal.
The reference to offsets, experts said, just indicates that Dassault hasn’t perhaps given all details of the offset partnerships it has entered into, something it has to do only by October 2019.
Indian offset partners and products will be confirmed by Dassault at the time of seeking offset credits.
a 50-50 sharing basis by the government and the World Bank.
The project is intended for the navigation of large vessels weighing 1,500-2,000 tonnes. The government says its objective is to promote inland waterways as a cheaper and more environment-friendly means of transport, especially for cargo, which would lead to a reduction in transport cost and highway congestion.
“It is a historic day for Kashi and eastern India. Today, Varanasi and the country are witnessing development work that should have been done decades ago,” Modi said.
Maintaining a depth of 2-3 metres for the Ganga to be navigable for larger boats, and setting up safe navigation systems remain key aspects of the project.
“Work is on for ensuring enough draught (the depth of water needed for a boat to be able to float) in Ganga from its origin in Gangotri to its last point in Gangasagar in West Bengal. During the forthcoming Kumbh Mela, ferries will run between Varanasi and Prayagraj,” Union minister for shipping, water resources, river development and roads and highways Nitin Gadkari said.
He said 268 water cleaning projects worth ~1,000 crore were also being undertaken.
Modi also inaugurated two national highway projects, constructed at a cost of ~1,571.95 crore. The first phase of the 16.55km Varanasi Ring Road has been completed at a cost of ~759.36 crore, while the work of four-laning and construction of the 17.25km Babatpur-varanasi road on NH-56 has cost ~812.59 crore, the government said.
He also inaugurated three sewage infrastructure projects worth ~425.41 crore for Varanasi and laid the foundation stone of a Sewerage Management Scheme for Ramnagar. The projects will help reduce pollution in the Ganga, the government said.
The filing of the price details is in compliance of an October 31 order of the Supreme Court which said: “The court would also like to be apprised of the details with regard to the pricing/cost, particularly, the advantage thereof, if any, in a sealed envelop.”
The government has till now resisted the court’s demands for price details of the jets. Attorney general of India KK Venugopal even went to the extent of telling the court that the pricing details are protected under the Official Secrets Act, 1923. So far, the government has only shared price details of the basic model of ₹670 crore with the Rajya Sabha.
The case will be heard on Wednesday, November 14.
In the redacted copy of the decision-making process shared with the petitioner and also available with Hindustan Times, the government has defended the purchase and said all processes were followed.
Defending the procurement, the government said that between 2010 and 2015, India’s adversaries inducted more than 400 modern aircraft and upgraded their older models. “They not only inducted 4th generation aircraft but also inducted 5th generation stealth fighter aircraft. An urgent need was felt to arrest the decline in the number of fighter squadrons in IAF and enhance their combat facilities,” it said.
The report added: “An Indian Negotiating Team (INT) was constituted to negotiate the terms and conditions of the procurement of the 36 Rafale Aircraft. The INT was headed by a Deputy Chief of Air Staff and comprised of Joint Secretary & Acquisition Manager (Air), Joint Secretary (Defense offset Management Wing) Joint Secretary & Additional Finance Advisor (Air), Advisor (Air) and Assistant chief of air staff (plans).”
It added, “A total of 74 meetings, which included 48 internal INT meetings and 26 external INT meetings with French side were held during negotiations.”
The purchases were made under an instrument called the Inter Government Agreement and “of the total procurement of about ₹7.45 lakh crore since 2002 IGAS account for 40% of the procurement,” said the government document.
Deflecting criticism on the offset partner, the document said: “insofar as discharging offset obligations by Original Equipment Manufacturer (OEM) and its Tier-1 vendors through Indian offset partners is concerned there is no mention of private Indian Business House”.
The National Democratic Alliance (NDA) government’s decision to enter a $8.7-billion government-to-government deal with France to buy 36 Rafale warplanes made by Dassault was announced in April 2015, with an agreement signed a little over a year later.
This replaced the previous United Progressive Alliance (UPA) regime decision to buy 126 Rafale aircraft, 108 of which were to be made in India by the stateowned Hindustan Aeronautics Ltd (HAL). hike in Minimum Support Prices (MSPS) for Kharif crops, have seen a decline in inflation in October 2018. Annual growth in inflation for cereals in the period between April 2018 and October 2018 was 2.77%. This is the lowest since 2016-17.
Meanwhile, core inflation continues to remain high and has actually gone up by 29 basis points to 5.84% in October 2018. Core inflation is a better indicator of non-cyclical inflationary pressures in the economy and hence is given importance in decisions such as setting interest rates. Rising core inflation might dent hopes of a reduction in policy rates by RBI in its next monetary policy review in the first week of December. Businesses gain from lower interest rates.
The Index of Industrial Production (IIP), or factory output growth, the short term indicator for industrial activity fell for the fourth consecutive month, and grew by 4.47% in September 2018. Prime Minister Narendra Modi announced a scheme earlier this month, which would enable small and medium enterprises to get a loan in just 59 minutes. This suggests a political premium for providing cheaper and easily accessible loans in the economy.
“Declining food inflation in October, when harvesting actually starts, shows that the increase in MSPS has not helped much,” said Pranab Sen, former chairman of the National Statistical Commission. This also shows that the farmers protests can’t just be wished away, Sen added. That’s worrying news for the government politically. awarded would be more than last year.
This also comes in the backdrop of the central government’s aim of doubling India’s national highways network to 200,000 lakh km by 2019.
“India needs massive infrastructure development up to ₹50 lakh crore… At this speed, I am confident we will complete construction of 90,000km of national highways,” Union minister for finance Arun Jaitley said during the budget speech in February for the current financial year.
The Union budget for 2018-19 pegged the budgetary allocation for the highway ministry at ₹71,000 crore, up from ₹61,000 crore allocated during 2017-18. Despite the enhanced budget, a road ministry official said that it has written to the finance ministry seeking more budgetary support.
“Sanctioning of funds is slow this year. As per our estimate, we may run out of funds by January, 2019. Keeping this in mind, we have written to the finance ministry seeking extra budgetary support,” another official at the ministry added, asking not to be identified. will not monitor it. Action is possible only if someone complains that a particular candidate is defying the apex court’s order.”