India had signed an inter-governmental deal with France in September 2016 to procure 36 Rafale Fighter Jets, from French aerospace, at the cost of Rs 59,000 crore. The Rafale fighter jets are the leading procurement of fighter planes in India. The Rafale is a French twin-engine which is designed and built by Dassault Aviation.
This deal is India’s biggest procurement. The Rafale jets would come with India-specific modifications with radar warning receivers, 10-hour flight data recording, low band jammers, infra-red search, Israeli helmet-mounted displays, and tracking systems. It was said that all the Rafale fighter jets will be delivered to India by the end of the year 2022. 18 Rafale fighter jets have been transported to India so far.
India’s Rafale Deal
The earlier seven-year exercise to procure 126 Medium Multi-Role Combat Aircraft (MMRCA) did not fructify due to disagreements over the production in India. When the Rafale fighter jet is compared to MMRCA, Rafale is much more advanced in technology, has a lower life cycle cost and specifications according to the latest warfare needs of India. The first batch of Rafale arrived in India On 29th July 2020, the second batch in November 2020, the third one in January 2021, and the third one on 3rd April 2021.
The judicial agency of France has alleged a probe against the Rafale deal between India and France. A French judge has been appointed to investigate a highly sensitive judicial probe into alleged “corruption and favoritism” as reported by a France website, Mediapart. The probe into the inter-government deal was formally opened on June 14. The investigation has been initiated by the Parquet National Financier (PNF), which is a French judicial institution.
Following the expose, the French anti-corruption NGO Sherpa, which specializes in financial crime, has filed a complaint with the tribunal of Paris citing:
- Influence Peddling
- Money Laundering
- Undue Tax Waivers
In 2019, PNF’s head Eliane Houlette, dismissed the initial complaint filed by the Sherpa NGO as it was said that she is pro-Dassault. She justified her decision by citing to preserve the interests of France. After two years, Jean Francois, who is the successor of Eliane Houlette has decided to support the probe after the complaint was updated. The Rafale deal took place under the presidency of Francois Holland, who said that there was no conflict of interest and France had no say on who Dassault’s Indian partner was.
It is reported by the French media that France’s Anti-corruption agency, Agence Francaise Anti-corruption, after investigation found that Dassault Aviation had paid 1 million euros to an Indian company. However, Dassault Aviation has rejected all these allegations of corruption, saying no violations were reported in the frame of the contract.
According to the investigation by Mediapart, the middlemen is accused of money laundering in India. The money was used to manufacture 50 large replica models of Rafale jets. The report claimed that Dassault was unable to provide a single document signaling that these models existed and were delivered. The inspector thus suspected that it was a bogus purchase which is designed to hide the financial transactions.
On the 25th of March, 2015, the Chief of Indian Air Force, chairman of HAL and the CEO of Dassault Aviation said that Dassault and HAL have signed the agreement. However, the next day Reliance and Dassault signed a memorandum of understanding just 15 days before the announcement by PM Narendra Modi.
Also, the French and Indian governments had removed the mandatory anti-corruption clause from the deal, despite the defense ministry’s advice to include it. The HAL was replaced by the Reliance Group, which had no experience in aeronautics.
One of the Dassault’s sub-contractor in India for the Rafale deal, the Defsys Solutions which is owned by Sushen Mohan Gupta, specializes in assembling flight stimulators and electronic and optical system for the aeronautical industry is in question. Sushen Gupta is accused of working for Dassault and obtain confidential documents from the Defence Ministry of India.
Mr. Gupta’s account recorded receiving payments in the year 2013-14 i.e. during the previous UPA Government. It is recorded that Dassault paid 14.6 million euros to Interdev in Singapore. Interdev transferred 2.6 million euros to Indian Company, ISD while the rest 11.9 million euros were transferred to Interstellar in Mauritius.
The Congress chief spokesperson, Randeep Surjewala has demanded Prime Minister Narendra Modi to set up the JPC ( Joint Parliamentary Committee) in which the Lok Sabha and Rajya Sabha members discuss and investigate the cases of financial irregularity in government activities. However, there is no reaction from the government or the BJP.
Before the Lok Sabha elections, the Congress party raised several questions about the deal and alleged corruption. However, the government had rejected all such charges. Congress has accused the government of massive irregularities in the contract. The government has procured each aircraft at a cost of rupees 1,670 crores as against rupees 526 crores which were finalized by the UPA government during the negotiations for the MMRCA.
On December 14, 2018 verdict, a three-judge bench led by Chief Justice Ranjan Gogoi gave a clean chit to the Rafale deal, holding that there was no commercial favoritism and occasion to doubt the decision-making process. The bench in a 107 page verdict rejected a clutch of petitions. On November 14, 2019, it had rejected the petition to seek review on its earlier decision.
Edited by Aishwarya Ingle