India has in principle has closed the French Rafale Jet deal at 7.8 Billion Euros or Rs 58,600 crores. However, the signing of the agreement will take time as approvals to ratify the price has to be taken from the Cabinet Committee on Security. A high-level team from France is expected to be in India in May to firm up the details for purchase of these 36 Rafale fighter aircrafts by India.
Indian officials led by Defence minister Manohar Parrikar have been negotiating hard to bring down the price of the Rafale deal. The expectation is that the final deal will be clinched by May-end. Defence minister Manohar Parrikar had told the media last month that he wanted to close the multi-billion dollar deal as early as possible.“I don’t fix timelines but I am definitely interested in finishing it as early as possible,” Parrikar had said. He had, however, said that price was an important issue. “Price is equally important. While I want the aircraft I will definitely be interested in the right price,” he said. The deliveries of the nuclear-capable multi-role Rafale jets are likely to begin in 2019.
Offset Obligations
The deal comes with the clause of delivering 50 per cent offsets, creating business worth at least 3 billion Euros for smaller Indian companies and creating thousands of new jobs in India. Under the proposed deal, companies like Safran and Thales will join Dassault in providing state-of-art technologies in stealth, radar, thrust vectoring for missiles and materials for electronics and micro-electronics.
This will boost PM Modi's ambitious "Make in India" campaign to cheer up multinational as well as domestic companies to manufacture products in India. It is the effort made by the PM to bring employment in India.
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