In an exclusive interview given to Economics Times editor Many Pubby, Dassault Aviation CEO Éric Trappier has strongly refuted the allegations made by Congress president Rahul Gandhi. He has said that the figures peddled by Rahul Gandhi regarding the deal are totally false and highly exaggerated.
When asked about the allegation that Dassault has ‘gifted’ ₹30,000 crores in offset business, Trappier replied that it is totally untrue. He informed that the Dassault Reliance Aerospace has been set up with a capital of ₹70 crores, which is a 49:51 joint venture between Dassault and Reliance. That means Dassault investment in the venture is just ₹35 crore, not ₹30,000 crore. He also informed that the capital in JV will be gradually increased as the operations expand, and the plan is to increase the capital in the project to ₹850 crore. So, the Dassault investment in the JV will be around ₹425 crore. And Reliance will also have to invest its portion of 51% in the JV.
The Dassault CEO said that the company will produce parts of business jet Falcon and hoped that maybe, one day a complete Falcon 2000 will be made at Multi-modal International Hub Airport at Nagpur (MIHAN), where DRAL is located.
When asked why Dassault described Reliance as a key partner, he replied that the JV will manufacture the Falcon, its parts and Rafale parts. As these are key products of the company, the JV needs to meet international standards. It is key because they plan to grow the JV to become a global aeronautical company.
Trappier informed that Reliance is not the Indian company they are working with and they in discussion with over 100 companies. The company has already signed up with thirty companies located at various parts of the country.
He reiterated that Dassault was under no pressure to form a JV with Reliance and it was entirely their own decision. He also reminded that the company had formed a JV with (Mukesh Ambani’s) Reliance in 2011-12 itself. Significantly, he said that as Dassault is a family owned company they feel comfortable with another family-owned company like Reliance.
He stressed that according to Defence Procurement Policy the choice of offset partner belongs to the contractor. He said, “when I choose a partner it becomes my responsibility to fulfil the obligations, to quality standards and timing. I made the choice.”
Trappier also rubbished the allegations that India was paying more for 36 Rafale jets than it was supposed to pay in the earlier deal for 126 jets. In the earlier deal during UPA, 18 jets to be made in France and the rest 108 in India by HAL. According to Trappier, the unit cost for the current 36 jets is actually 9% lower than the unit cost for 18 jets in the earlier deal. He said that only the price for 18 and 36 jets bought in flyway condition must be compared, the prices for jets made in India can’t be considered in this case. He also said that if the price was increased, Dassault would not have got the contract.
The CEO has rejected that there is any corruption in the deal as claimed by opponents of the deal in India, and clarified that it is open for an investigation in the matter. “We will prove that there is no corruption. We are open, we are engineers and we want to be in India”, he said.
Trappier said that they only want to develop capabilities in India not only for manufacturing but also for design and development. He said that he is a little bit sad about the controversy because India holds many opportunities that he is enthusiastic about.
