After the point-by-point rebuttal of Rahul Gandhi’s allegations on Rafale deal by Arun Jaitley in the parliament yesterday, the Congress president addressed the media in the evening. The finance minister also had hinted that Congress may be trying to stall the Rafale deal at the behest Eurofighter, a competitor of Rafale fighter aircraft.
If anybody was expecting something new from Rahul Gandhi, then the press conference was a big disappointment. It was just a continuation of what he has been saying all these months, there was nothing new. It was just a repetition of lies that have been busted numerous times, which he continues to peddle.
— Congress (@INCIndia) January 2, 2019
In Lok Sabha, Arun Jaitley had said that Rahul Gandhi is inventing numbers related to Rafale deal without any basis. He said sometimes they say Reliance has get offset business of 1,30,000 crore, sometimes they say it is ₹30,000 crore. Instead of telling from where he is getting the values of offset business, Rahul Gandhi went on to explain how he got the cost of the Rafale in the current deal. Quoting Jaitley’s speech today, he said that as per government itself the total cost of the deal is ₹58,000 crore for 36 aircraft, hence the unit cost is ₹1,600 crore. He said that in the UPA deal, the cost per aircraft was ₹526 crore.
That is a big lie. In the current scenario, India has already signed a contract for the purchase of the aircraft, while no contract was signed by the UPA government. The ₹1,600 crore is the price of a fully weaponised aircraft, and it is already known that the cost of a bare aircraft is less than 50% of the total cost of weaponised aircraft. Speaking to media after the press conference of Rahul Gandhi, Arun Jaitley informed that there were two prices in the UPA deal, one for bare aircraft and the other for weaponised aircraft. It is also important to note that India is buying entire 36 planes from France, while in the earlier deal, 18 planes were to be bought from France and the rest 108 were to be made by HAL in India. The costs for both categories are different, hence the prices of both the deals cannot be compared directly. Only the price of 18 aircraft in the previous deal can be compared with the current deal for 36 aircraft. Both the Indian government and Dassault has informed that the current price is 9% cheaper compared to the earlier price.
During the now scrapped deal for 126 fighters, the amount of ₹400-500 crore appeared in media during the initial stages. It was never a final price, as Rahul Gandhi would like us to believe. In the RFP issued for 126 Medium Multi-Role Combat Aircraft (MMRCA) in 2007, the cost was estimated at ₹42,000 crore, which gives ₹333 crore as average cost per aircraft on a simplistic calculation. After the passage every year, the price increased steadily. When Rafale was announced as the winner of the deal in 2012, the average cost per aircraft was around ₹420 crore. But after that, the deal could not proceed, as there were disagreements over the 108 planes that were to be made by HAL. The public sector company was demanding 2.7 times the manhour to make each plane compared to what is taken by Dassault. Which means if implemented, the actual cost would have been much higher, as more time means more money.
By 2014, in just two years, media reports quoted a price of around ₹1,000 crore per aircraft in the deal. When the Rafale was selected, it was a $10 billion deal, but when it was scrapped in 2015, it had become a $20 billion deal. And that value was based on estimated market value of the aircraft based on inflation, decreasing Rupee value etc, not a price agreed upon by both the parties. These were rough estimates and didn’t take into account various weapons and India specific modifications. According to estimates by the defence ministry, the final price of 18 Rafale aircraft to be directly bought from Dassault under the UPA deal would have been ₹1,705 crore, taking into account the cost of weapons, maintenance etc, which is more than the current amount of ₹1,646 crore. There was no final figure in the previous deal for 126 jets, so the figure of ₹526 crore quoted by Rahul Gandhi has no basis.
Another proof that the earlier deal didn’t have a final price is the fact that, Rahul Gandhi himself keeps changing the amount. Yesterday, the Congress president said that the cost in UPA deal was ₹560 crore, while earlier he had claimed it that it was ₹526 crore. He had also quoted ₹520 crore and ₹540 crore on different occasions. During election rallies before the recent assembly elections, he had also said that the price in the UPA deal was ₹700 crore.
In the parliament yesterday, Arun Jaitley went to a great length to explain the meaning of the offset clause in defence purchases by India. He said that offset means the foreign vendor has to buy some items from India, the value of which ranges from 30% to 50% of the value of the contract. It does not mean the offset partner manufacturers that item of the deal. He also explained that there are more than 100 offset partners of Dassault, and the value of offset business received by Reliance is around ₹800 crore, not ₹30,000 crore as Rahul Gandhi is alleging.
But all that explaining by Jaitley was of no use because, in just a couple of hours, Rahul Gandhi repeated the same lie again that Modi gave Anil Ambani ₹30,000 crore in the deal. As the price of the aircraft, Rahul Gandhi keeps changing the amount he claims that ‘Modi has gifted to Ambani’. Sometimes he says it is ₹1 lakh crore, while sometimes it goes up to ₹1.30 lakh crore, both the figures substantially more than the total value of the contract for 36 aircraft. Even the ₹30,000 crore is more than the total offset of around ₹29,000 crore in the deal, while the share of Dassault in offset obligations is much lower, as other vendors in the deal – MBDA, Thales and Safran – also have offset obligations against their respective shares in the deal.
In the short press conference, Rahul Gandhi repeated the Modi gave Anil Ambani ₹30,000 crore several times, but the journalists present at the event didn’t ask him how he got this figure or why he is still repeating this long after it had been proved to be a lie.
Yesterday, Congress party circulated one doctored audio claiming to be a conversation between Goa minister Vishwajit Rane and an unnamed journalist, where Rane was purportedly saying that Goa CM Manohar Parikar claimed to have Rafale files at his home. Rahul Gandhi tried to play the audio in the parliament, but when Arun Jaitley asked him to authenticate the tape before playing, he had backed down. When asked about the tape in the press conference, Rahul Gandhi gave a bizarre answer, saying that as he was not allowed to play the tape by the speaker, hence the question of authenticating it does not arise. He also said that there might be other tapes, there might be many other tapes going around.