French firm Dassault Aviation on Thursday said its partnership with Reliance Defence represents just about 10% of the offset investments under the Rafale jet deal. Chief Executive Officer Eric Trappier said the company was in negotiations with about a “hundred Indian companies”.
India signed an inter-governmental agreement with France in 2016 to buy 36 Rafale fighter jets at a cost of Rs 58,000 crore. Businessman Anil Ambani’s Reliance Defence joined the offset programme in late 2016 through Dassault Reliance Aerospace Ltd.
Dassault released Tappier’s interview with AFP as a statement to clarify its position on the offset deal. In the interview, Tappier, said signing an offset contract is a requirement under Indian law (Defence Procurement Procedure). “The implementation of offsets is an obligation and, under the Indian regulation, the choice of the partners belongs to us,” he said. “Dassault Aviation therefore decided to set up the DRAL joint venture with Reliance and build a plant in Nagpur, which should enable us to meet about 10% of these offset obligations. We are in negotiations with about a hundred Indian companies and partnerships have already been concluded with about thirty of them.”
He said the joint venture will produce parts for the Falcon 2000 jet and Rafale, adding that the first Falcon 2000 parts should be ready by the end of the year. He said Nagpur was selected as a site due to the availability of land and direct access to an airport runway. “Things are progressing rapidly,” said Tappier. “We set up DRAL on 10 February 2017 and the plant project was officially launched on 27 October 2017.”
The firm’s statement comes after Mediapart, a French investigative website, said Wednesday claimed to have accessed a document that showed that the offset contract with Reliance Defence was a “trade off” to obtain an agreement for Rafale sales in India. Defence Minister Nirmala Sitharaman, who is on a three-day visit to France, said on Thursday in Paris that the government was not involved in selecting Reliance Defence as a partner to Dassault Aviation. “This offset obligation may be mandatory, but the names of the companies are not mandatory for me,” she said.
The Congress and several other Opposition leaders have accused the Narendra Modi government of getting an overpriced deal on the Rafale jets. Congress President Rahul Gandhi on Thursday labelled Prime Minister Narendra Modi a corrupt man.