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In Supreme Court, Centre Explains Why HAL Was Not Picked as Offset Partner in Rafale Deal

The government said HAL required 2.7 times higher man-hours compared to the French side for the manufacture of Rafale aircraft in India.


Updated:November 13, 2018, 3:25 PM IST

New Delhi: The Centre told the Supreme Court on Monday that state-owned Hindustan Aeronautics Ltd (HAL) failed to become an offset partner in the Rafale deal as there were several unresolved issues it had with French company Dassault.

In the documents submitted before the top court, the government claimed that the issues pertained to lack of common understanding between HAL and Dassault Aviation.

"The contract negotiations could not conclude mainly due to unresolved issues related to 108 aircraft to be manufactured in India. These issues pertained to lack of common understanding between HAL and Dassault Aviation on following," the documents said.

It said HAL required "2.7 times higher man-hours compared to the French side for the manufacture of Rafale aircraft in India".

Congress has claimed that Dassault has been pressurised by the government to do away with the HAL as strategic offset partner by saying the future of India's aerospace industry has been destroyed by snatching Rafale from HAL.

Referring to earlier aborted deal, the document said Dassault was required to undertake necessary contractual obligation for 126 aircraft (18 direct flyaway and 108 aircraft manufactured in India) as per request for proposal  requirements and contractual issues with HAL on manufacturing of 108 jets in India could not be resolved.

The submissions were made in the document titled "Details of the steps in the decision making process leading to the award of 36 Rafale fighter aircraft order", which were made public by the Centre on Monday. The inter-government agreement (IGA) was signed by the defence ministers of both countries on Sept 23, 2016.

Congress President Rahul Gandhi has been accusing Prime Minister Narendra Modi of forcing the French company to select a Reliance group firm of Anil Ambani as an offset partner to help it "pocket" Rs 30,000 crore.

Congress has also alleged the government was procuring each aircraft at a cost of over Rs 1,670 crore as against Rs 526 crore finalised by UPA government when it was negotiating a deal for procurement of 126 Rafale jets.

However, the document, placed by the NDA government, said, "It is reiterated that the procurement process as laid down in the Defence Procurement Procedure (DPP)-2013 was followed in procurement of 36 Rafale aircraft.

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