The Big Story: Art of the deal

The details of the Dassault Rafale deal, under which the French company will supply India with 36 aircraft, cannot be revealed as they are classified, Defence Minister Nirmala Sitharaman has said. Information on cost per aircraft was protected under “Article 10” of the inter-governmental deal signed by France and India, she said in her statement. Information on the “offset deal” with private companies in India, involving investments in terms of transfer of technology and maintenance, had not been provided by France yet.

Sitharaman was answering questions put to her by the Opposition in Rajya Sabha. Not surprisingly, the Congress is now on the warpath, with party president Rahul Gandhi alleging the deal was a scam. More surprisingly, the defence minister’s reply is in stark contrast to her own assurances last year. Then, she had said the government would reveal the costs and the specific figures, because “public money” was involved, and the difference between the United Progressive Alliance and the National Democratic Alliance was “transparency”. Within months, the government has gone back on its own word.

Negotiations on the Rafale deal, which the current government inherited from the Congress era, have been controversial from the start. Under the Narendra Modi government, several questions remain. First, the opposition has accused the government of buying overpriced aircraft, even though the Bharatiya Janata Party had claimed the government led by it had got a better deal. The Congress-led government had negotiated for 126 aircraft, 18 of which would be ready to fly while the rest would be manufactured by Hindustan Aeronautics Limited with the help of Dassault. If remarks by then Defence Minister Manohar Parrikar made in 2015 are to be believed, the figure quoted for that deal had been Rs 90,000 crore.

But by 2015, the Congress-era negotiations were dead. Prime Minister Narendra Modi scaled down the contract to the purchase of 36 ready to fly aircraft and the new deal amounted to Rs 58,000 crore. Estimates suggest that the government is now effectively paying Rs 1,063 crore per aircraft, as opposed to Rs 714 crore under the deal proposed earlier, the difference being attributed to the “high end” aircraft now being purchased. Unlike now when the government is citing a confidentiality clause, on September 23, 2016, the government had stated in a written reply in Lok Sabha that “the cost of each Rafale aircraft is approximately Rs 670 crore.” But the cost per unit go up to almost Rs 1,640 crore if the overall deal is taken into account, with this difference sought to be explained as extra costs because of the inclusion of a “deadly weapons package, all spares and costs for 75% fleet availability and performance-based logistics support for five years”. The government has also been accused of rejecting a much cheaper deal offered by Eurofighter Typhoon. Since it has not revealed the particulars of the current contract, there is no way of knowing.

Second, questions have been raised about the procedure followed in announcing the deal. It seems to have been a unilateral commitment made by Modi during a visit to France in 2015, without any consultation with the relevant cabinet bodies or ministries. The government later claimed that defence procurement procedures allow for regular protocol to be by-passed on strategic grounds. But even these transactions must be cleared by the competent financial authority, in this case, the cabinet committee for security, which only came into the picture later.

Third, the Congress alleged that Reliance Defence, a private company, had been favoured by the government and Hindustan Aeronautics Limited jettisoned from the offset deal, giving rise to a cost difference. The government is taciturn about the details of these transactions as well. As observers have pointed out, the details of an inter-governmental contract may be classified but it is not clear why French industrial suppliers cannot disclose how they have distributed money among private partners in India.

These questions point to suspicions of nepotism at best and outright pilfering of public money at worst. The transparency that the Modi government boasts of is entirely missing from the way it has conducted the deal. If the National Democratic Alliance is to prove it does business differently from its predecessor, it needs to reveal the details of the Rafale contract.

The Big Scroll

Watch this video of Sitharaman saying the difference between the Congress-led United Progressive Alliance and the BJP-led National Democratic Alliance is “transparency”.

Punditry

  1. In the Indian Express, MP Nathaneal writes that senior policemen must be held responsible for encounters and custodial deaths.
  2. In the Hindu, Prashant Bhushan has some questions on the allocation of cases in the Supreme Court.
  3. In the Telegraph, Sankarshan Thakur on how the media is happy to be co-opted by government.

Giggles

Don’t miss...

V Geetha revisits an album by the legendary Tamil musician, Ilaiyaraaja:

Years ago, when he dared to embed a famed classical varnam within the genre of a romantic duet, he caused a stir. Likewise, when strains of Bach gave way to the ritual chanting of the thevaram, many wondered at this instance of musical subversion, its meaning and relevance to the film sequence in question. Yet, on both occasions, the sheer novelty and daring of his music won the day.

But with the Thirvasagam, the subversion appears to have crossed all limits, mixing and matching musical styles and genres in a cross-cultural conversation that seems an exercise in creative civilisational dissonance. For here is a collection of six poetic songs – achingly poignant in their mediation on mortality – housed in a grandiloquent musical structure that does not quite allow them a habitation. It is this unease, though, that makes this album memorable.