Paris: Defence minister Nirmala Sitharaman refuted allegations of any wrongdoing on the part of the government in the 2016 deal to buy Rafale fighter jets from France, which critics say unfairly profited a key backer of Prime Minister Narendra Modi.
Speaking at a briefing in Paris, Ms Sitharaman reiterated the government’s claim that it had no idea the jets’ builder, Dassault Aviation, would team up with Reliance Group, run by Anil Ambani.
“We are very clear: With the government of France, we agreed to purchase 36 Rafale aircraft in flyaway condition,” Ms Sitharaman said.
“And in an intergovernmental agreement, there are no mentions of any individual firms,” she said.
“The offset obligation maybe mandatory, but the names of the company are not mandatory,” she said ahead of a visit to Dassault factory where Rafale fighter jets are being manufactured for India.
Dismissing Congress allegations that she has gone to France on a cover-up exercise, the minister insisted that the government had no part in the selection of Reliance Defence as a joint venture partner in the Rafale deal.
Several reports say Dassault was forced to choose Reliance by Mr Modi, despite its having almost no experience in the aviation sector.
On the eve of Ms Sitharaman’s visit French investigative website Mediapart quoted the notes of a meeting between Dassault management and workers’ representatives which described the choice of Reliance as “imperative and compulsory”.
Pressed on whether India would go ahead with the deal amid a chorus of “crony capitalism” claims and complaints filed by Indian anti-corruption groups, Ms Sitharaman adopted a more combative tone.
“It is more for the companies which have chosen A, B or C as their partners to answer questions if there are any,” she said.
Dassault on Wednesday contested the Mediapart report, saying it had “freely chosen” to form a joint venture with Reliance.
But that stance was contradicted recently by former French President Francois Hollande, under whose watch the Rafale deal was signed.
Mr Hollande said last month that France had “no choice” but to join with Reliance after it was pushed by the Indian government —- comments which were seized upon by the Opposition Congress.
The Congress has been alleging massive irregularities in the 36-aircraft deal, saying the government was procuring each aircraft at a cost of over '1,670 crore as against '526 crore finalised by the UPA government when it was negotiating the deal.
Under Indian defence procurement rules, foreign companies winning contracts must “offset” or reinvest half the total value — in this case around eight billion euros —- in joint ventures or purchases with Indian firms.
Dassault Aviation’s CEO Eric Trappier told AFP that a joint factory with Reliance in Nagpur represented “around 10 per cent” of the roughly four billion euros of offset investments.
“We’re in talks with about 100 Indian firms, including around 30 with which we’ve already confirmed partnerships,” he said.
Dassault negotiated for years with India’s state-owned Hindustan Aeronautics Limited (HAL) for the order, with the jets being jointly built in India.
But those talks were cancelled after Mr Modi took office, when he decided to purchase the jets directly from France.
