Rafale deal in last lap, may cost Rs 60,000 crore for 36 fighters

NEW DELHI: India is closing in on the final details of the Rafale fighter deal ahead of French President Francois Hollande’s visit, with the cost of the contract for 36 fighters expected to cross Rs 60,000 crore, authoritative sources told ET.

A high-powered delegation, which includes National Security Advisor Ajit Doval, is currently in Paris. Doval was instrumental in India’s decision to opt for the purchase of the French fighters last year. Most of the trickier parts of the deal– including offsets and the weapons package— are said to have been resolved.

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In pic: Rafale jet
While the final cost of the contract will be revealed after an inter-governmental agreement is signed, officials involved in the process pegged it at more than Rs 60,000 crore. It’s not clear whether this will include the weapons package for the fighter deal.

To put things in perspective, when the process to find a new fighter jet started in 2007, IAF estimate was that for 126 aircraft it would have to shell out Rs 60,000 cr. However, the technical evaluation by the Air Force knocked out cheaper jets, including the Swedish Gripen as well as the American F16, leaving the most expensive fighter jets offered in the fray.


In pic: Swedish Gripen

The final price will depend on the support package that is finally negotiated. The Air Force wants the French to guarantee that at any given point, at least 90% of the fleet should be fit for combat. This is against the 55% availability rate of the Russian Su 30 MKI fighter.

“The price would depend on the support package and the length for which the Air Force wants it. For a 10-year package, the cost will be higher as more spares will need to be sourced. India wants the same availability rate for the fighter that the French Air Force has,” an official told ET.

Sources have told ET that several industry leaders are also in Paris as discussions are on to ensure that the inter-governmental agreement is signed. As reported by ET, India’s largest foreign military deal is likely to bring in big business for the private sector with the French side looking to set up a production centre for the Rafale as well as a low-cost executive jet in India, besides sharing vital technology for Tejas project.