Dassault Agrees Rafale Workshare With Indiahttp://ibnlive.in.com/blogs/sauravjha/2976/65137/why-the-dassault-rafale-will-be-purchased-by-the-indian-air-force.html
AIN Defense Perspective » March 14, 2014
by Guillaume Lecompte-Boinet
| March 13, 2014, 10:22 AM |
Dassault Aviation has reached a firm agreement with India’s Hindustan Aeronautics (HAL) over workshare for the 126 Rafale fighters that the country has agreed to buy. The agreement was confirmed on Thursday at Dassault’s annual financial results press conference in Paris by CEO Eric Trappier. The agreement covers the general configuration of the aircraft, the technology transfers and the detailed workshare between the two partners and their subcontractors. Also, it clarifies the mechanism for handling warranties, said Trappier.
“It’s a major step before signing the final contract,” said Trappier, noting that this landmark could come in “the next weeks or months.” The contract is estimated to be worth between $10- and $15 billion, but that has not been confirmed by Dassault.
Out of the 126 Rafales, 18 will be built in France in the Dassault Aviation facilities. The next 106 fighters will be built in India with a stepped transfer of responsibilities. The technology transfers account for up to 50 percent of the value of the contract. Dassault estimates that it would take roughly three-and-a-half years to deliver the first Indian Rafale.
Trappier also reported that India is “not the sole country where we could sell Rafale.” Dassault has answered an RFI from Canada, a country that, according to the Dassault CEO, is studying canceling its F-35 JSF purchase because of the high cost of the Lockheed Martin fighter. Dassault is in preliminary talks with Canadian manufacturers so as to be ready to sign an industrial agreement if Canada decides to cancel its 65-aircraft F-35 purchase. “It’s challenging, but if Canada cancels, Rafale will be in the race for sure,” he said.
Dassault is cautious about other possible export markets for the Rafale. In the United Arab Emirates, talks on a 60-Rafale purchase are proceeding with a “new roadmap,” according to Trappier, who declined to comment further. Dassault Aviation has answered the RFI issued by Qatar. “We are confident because Qatar is an old partner for Dassault; it has 12 Mirage 2000-5s,” said Trappier, but he declined to comment on a possible purchase of the Rafale by Malaysia, except to note that Dassault has made a proposal based on the supply of 18 aircraft.
Last year, Dassault delivered 11 Rafales to French forces, and a similar number is scheduled for this year. Deliveries are now to the latest F3R standard, which includes the Thales AESA radar and the capacity to fire the Meteor missile, as certified by the DGA (Délégation Générale à l’Armement).
Regarding the Neuron UCAV demonstrator, Dassault has undertaken radar cross-section measurements “with success,” said Trappier, and made approximately 20 test flights, mainly in France. This year, another 20 test flights are scheduled to open up the flight envelope.
Why the Dassault Rafale will be purchased by the Indian Air Forcehttp://www.rediff.com/news/special/the-rafale-deal-and-why-it-makes-china-nervous/20130121.htm
Friday , March 14, 2014 at 14 : 30
In 2011, the IAF managed to get the government to revise its sanctioned combat squadron strength upwards to 42 from the previous 39.5. This decision was taken in light of the need to factor in the rising presence of the Chinese Air force (CAF) in Tibet supported by the creation of new ground infrastructure as well as aerial refuelling while simultaneously continuing to maintain an advantage over the Pakistani Air force (PAF) along India's western flank.
Besides dealing with a two front operational scenario the IAF is also required to expand its presence in peninsular India as well as in the island territories in anticipation of a stability role in the Indian Ocean Region (IOR). Be that as it may, for the period spanning the twelfth plan (2012-17), the IAF says that the number of operational squadrons has 'stabilized' at 34. And the new sanctioned strength according to the IAF would be attained only during the 14th plan (2022- 2027).
But to reach that figure in a smooth manner while accounting for risks such as an unforeseen decline in operational reliability of legacy aircraft, the IAF's current transformation has to remain on course with proposed inductions in the 'light', 'medium' and 'heavy' categories occurring as planned. And if the higher figure of 55-60 squadrons that are apparently needed for India to completely dominate the IOR are considered then both the Medium Multirole Combat Aircraft (MMRCA) and Tejas programs need to be pursued more vigorously.
The IAF, it was revealed earlier this year, still flies up to 235 Mig 21s (it had 264 in 2013) including over a hundred with the Bison upgrade package. While there is no denying that this fighter is still quite capable when armed with jammers and upgraded radar in the point defence role, it is after all long in the tooth now. Now on account of the delays in finalizing the MMRCA contract some Mig-21s are likely to labour on till 2019 instead of the earlier 2017 retirement date for the last planes still in frontline service at that point. A similar story may play out for the remaining 70-80 Mig-27s, half of which have been modernized, which were also scheduled for retirement by 2017.
Nevertheless the fact remains that a large proportion of 315 odd Mig-21s and Mig-27s currently in the IAF's order of battle are no longer going to be part of the active force structure of the IAF by 2020. Some of the numbers will be made up by some 80 odd domestically produced Su-30MKIs in the 'heavy' category that will join the force by 2017-18 in addition to the 180-190 already in service. Till that same period about 40 HAL Tejas Mk-Is in the 'light' category are also expected to be inducted into the force. But that still leaves the IAF in a situation wherein it will have to perhaps bring in another 150 new fighters by 2020 to compensate for scheduled retirements, assuming that a few squadrons of Mig-21 and Mig-27 upgraded versions labour on even beyond 2019.
Given that the Fifth Generation Fighter Aircraft (FGFA) which is in the heavy category is likely to begin entering IAF service only towards the tail end of the 13th plan (2017-2022) other fighters will have to make up for a reduction in the Mig inventory. One obvious way would be to continue domestic production of the Su-30 MKI in the proposed Super 30 configuration featuring better radar and weapon versatility. But given HAL Ozhar's current performance this would likely yield another couple of squadrons by 2020. Although that could change with the right kind of governmental will.
The same could be said of the Hal Tejas programme. Even as this is written, the second phase of the Initial Operational Clearance (IOC-2) for the Tejas Mk-I is nearing completion with 40 Series production (SP) units on order by the IAF. Tejas MK-I development is now basically over and the fighter will receive final operation clearance (FOC) in 2014. Tejas MK-II development is progressing concurrently and is projected to be wrapped up by 2017-18. The IAF at the moment has a projected requirement of some 124 Mk-IIs. HAL is believed to have set up a slightly manpower heavy production line that can deliver 8-16 Tejas Mk-IIs annually from a new facility.
If we assume that Mk-II development timelines can be kept we are most likely to see another 30 plus Tejas Mk-II inducted into the IAF by 2020.
But clearly inductions beyond the heavy and light category are needed to make up for planned retirements. While it is often pointed out that the IAF is inducting much more capable and multi-role aircraft as replacements of legacy Mig series, the fact is that the IAF's tasking environment has also expanded in scope as have its adversaries' capabilities.
While the PAF's new inductions at the moment are not that impressive, consisting in the main of JF-17s and some more F-16s from West Asia with the acquiescence of the United States, it is difficult to say what the future will look like. This is because the Chinese have started fielding fourth generation fighter aircraft themselves and have two fifth generation programmes in the form of the J-20 and J-31 underway. Heading later into the decade J-10Bs which are upgraded versions of the J-10A and feature an airborne electronically scanned array (AESA) will find their way into the CAF and very likely into the PAF as well despite the purchase of old F-16s by the PAF.
Incidentally CAF J-10As and Su-30 MKKs already conduct routine patrols over Tibetan airspace. China's base infrastructure on the Tibetan plateau has also been modified to facilitate year round basing of a modest fighter force. New refuelling capability in the form of converted H-6U aircraft is also being fielded by the CAF.
While its posture at the moment isn't that threatening for the IAF, the CAF has the margins to increase deployments in Tibet. Moreover, if the J-20 development programme turns out to be successful, this fighter will also be deployed in the Tibetan theatre by 2020-2022.
If one adds the IAF's need to support the Indian Navy in its role as a net provider of security in the IOR, it is clear that leave alone one-for-one replacement of retiring strength, the IAF actually needs to augment numbers as evidenced by even the government's approval for raising its sanctioned strength in 2011. It is here that the IAF's projected requirements in the 'medium' category gain significance.
Assuming a continuing SU-30 MKI production line till 2020 and timely induction of Tejas Mk-II units, it is clear that the IAF will need to bring in at least another 70-80 odd new fighter aircraft by 2020 assuming at least one for one replacement of retiring Migs as outlined above. When the Dassault Rafale was finally selected as the IAF's choice for the MMRCA requirement in 2012, it was expected that this would be realized more or less smoothly, with 18 aircraft delivered off the shelf by 2014-15 and series production beginning at HAL subsequently.
However, things have not turned out as planned. It is clear that the delivery contract for the Dassault Rafale will not be signed in 2013-2014. Only a new government at the centre will do so now perhaps in 2014-15. The delays have both been on account of Dassault's issues with HAL and the depreciation of the rupee which has made this buy at least 20 percent more expensive than earlier projected. The UPA's election year freebie dissemination has also meant that various other expenditure heads are being curtailed to keep the fiscal deficit at manageable levels. Indeed the parliamentary standing committee on defence pointed out in April that the amount allocated to the IAF falls well short of what it needed to execute the MMRCA contract.
However, even if the MMRCA contract is finally signed in 2014-15 it would still give a fillip to the IAF's 42 squadron build-up by 2027, even if the numbers in the 13th plan are made up by better SU-30 MKI and Tejas Mk-2 production numbers. The Dassault Rafale actually is a good fit for the IAF's emerging force posture since it is known to be rather capable in the air to ground role as demonstrated by its performance in air campaign over Libya.
Now even as the IAF has to look carefully at its strategy for enhancing combat potential in this decade, it will certainly have to move forward on the MMRCA requirement to field a two front deterring force in the 2020s. While the IAF has invested heavily to upgrade 100 odd Mig-29s and Mirage 2000s which will keep them from obsolescence till the early 2030s and is strengthening its ground support fleet by fitting new engines in about 125 Jaguars, it has to move forward on its planned induction of the MMRCA to manage a smooth rise to a 42 squadron force by 2025 given the FGFA's production schedule.
The Dassault Rafale will help even out the induction process in terms of timing and availability since its basic development is complete and the issue is one of manufacturing it quickly enough here in India. However it must be said that any purchase of the Dassault Rafale must happen with full transfer of technology in key areas such as radars and propulsion. The Rafale is being brought in not just for combat potential but also to take India's aerospace sector to the next level through offset requirements especially given the massive costs involved. If the French stick to promised terms and conditions the option clause for 63 more aircraft will probably get exercised.
By the 2020s, with a much bigger economy and trading interests than now, India will look more closely at the 55-60 squadron force that the IAF was once envisaged to grow into. At such a time hot Tejas and MMRCA lines will certainly be an asset. While these fighters may lack 'all aspect' stealth their overall characteristics in an electronic support environment will keep them more than competitive against most enemy aircraft. It is perhaps time to bite the bullet on higher numbers for both with a view to properly exploiting economies of scale.
The Rafale deal and why it makes China nervoushttp://www.defense-aerospace.com/article-view/feature/132379/why-rafale-won-in-india.html
The People's Daily, the Chinese Communist newspaper, says the sale of the Rafale fighter plane 'encourages, excites and spurs India's appetite and ambition to become a great military power while intensifying its aggressive and expansionist tendencies, which poses a serious threat to peace and stability in Asia.'
Does India have a choice, considering the People's Liberation Army's frantic speed of development, wonders Claude Arpi.
There were six in contention; four were dropped, and one became the Chosen One: The Rafale.
In French, 'Rafale' poetically means a 'sudden gust of wind.'
It was one of the six fighter aircraft in competition for the Medium Multi-Role Combat Aircraft, MMRCA, when the Indian Air Force wanted to acquire 126 polyvalent fighter planes.
In April 2011, the IAF shortlisted two birds -- the Rafale produced by Dassault Aviation and the Eurofighter (known in Europe as 'Typhoon') from EADS, the European consortium.
It was a big deal worth $12 billion. You can imagine the stakes, especially for Dassault which a few months earlier, was unsuccessful in exporting its flagship plane to Brazil and the Emirates.
Finally on January 31, 2012, the IAF announced that the Rafale was the chosen one.
The 'deal of the century' was that 18 Rafales would be supplied in fly-away condition by Dassault to the IAF by 2015 (or three years after the signature of the contract) and the remaining 108 pieces would be manufactured in India under a transfer of technology agreement.
The concurrent company did not let go easily and a lot of lobbying started. The British prime minister wanted Delhi to explain the reasons of favouring the French. 'The Typhoon is a superb aircraft, far better than the Rafale,' David Cameron said, adding: 'Of course, I will do everything I can --- as I have already -- to encourage the Indians to look at the Typhoon, because I think it is such a good aircraft.'
Interestingly, the Chinese were also unhappy with the selection of the Rafale by the IAF, but for other reasons.
An article published in The People's Daily (French edition only) argued that India and France were supposed to be non-violent countries, how could they ink such a deal?
The Chinese Communist Party newspaper affirmed: 'During the twentieth century in France there was a great writer called Romain Roland (1866-1944), the Nobel Laureate for Literature, who was strongly opposed to war. In India, there has been an illustrious politician named Mohandas Karamchand Gandhi (1869-1948) who was a pacifist leader, known worldwide for his fights against violence.'
'At present, their homelands are engaged in a sinister and repulsive arms race, which shakes and profoundly changes the international scene. If by chance these two great and illustrious men were still alive, what would they feel about this selfish and pernicious transaction and what opinion would they give in this matter?'
Is it not amusing that the Chinese Communist Party's mouthpiece today quotes Gandhi in connection with the Rafale deal?
The People's Daily article also says the sale of the Rafale 'encourages, excites and spurs India's appetite and ambition to become a great military power while intensifying its aggressive and expansionist tendencies, which poses a serious threat to peace and stability in Asia.'
Well, does India have a choice, considering the frantic speed of development of the PLA (People's Liberation Army), PLAAF (Chinese Air Force) and PLAN (Navy)?
A few months later, an Indian MP alleged that there had been 'manipulation in the evaluation process'.
This eventually delayed the process as an independent investigation had to be conducted; it finally concluded that the evaluation was conducted according to the RFP (Request for Proposal) terms and defence procurement procedures. The intricate negotiations thus lost several months.
Once the hurdle created by the MP was removed, it was reported that in September, while in Bangalore, Air Chief Marshal N A K Browne stated that the process continued: 'The negotiations are absolutely on. We hope that at least this financial year, we should be able to finish the negotiations and finalise the deal... It is a very complex project, as we are discussing various areas like transfer of technology, the offset clause, what Hindustan Aeronautics Ltd will do and the cost as well.'
Dassault had some doubts about HAL's capacity to produce 108 aircraft; probably with reason, looking at the fate of the Tejas project which has taken more than 30 years to take off.
On November 6, Rakesh Sood, the Indian ambassador in France, told the Indian Journalists Association at India House in London that the contract would soon be concluded. 'The Rafale deal is in the final stages and hopefully, it should be concluded in the next 3 to 4 months.'
The negotiation, Sood added, was a hugely complex exercise. 'Along with that a pretty stringent clause has been put for transfer of technology, (there is an) offset clause, and Dassault Aviation has accepted them.'
At that time, it was probably thought that the signature of the deal could be synchronised with French President Francois Hollande's visit to India. Though Sood had certainly not read the French edition of The People's Daily, he spoke of France's 'long interest in Indian civilisation', adding 'recently a (French) lady had produced a nine volume Ramayana in French... Indian music, yoga and films are quite popular in France.'
Sood's conclusions about the civilisational closeness between India and France were not similar to Beijing's: India needed the Rafales. But it was not considering the cash crunch. The Indian economy was not doing as well as Montek Singh Ahluwalia, deputy chairman of India's Planning Commission, had announced, and the fiscal deficit had to be cut, Finance Minister P Chidambaram said.
Last May, Defence Minister A K Antony told Parliament that his ministry would seek a hike in the Rs 193,408 crore (Rs 193 trillion) defence outlay of the 2012-2013 budget as only a budget increase could take care of the threat of the China-Pakistan military nexus. Antony spoke of 'new ground realities' and the 'changing security scenario'.
But with the changing scenario, the Indian defence ministry announced it had to prioritise its expenditure for the remaining months of the financial year. The ministry decided to focus on purchases that would impact on the armed forces' operational preparedness.
For example, the ministry planned to speed up infrastructure development in Arunachal Pradesh, buy ammunition to end shortages and acquire high-value assets, from aircraft to warships.
In December, the finance ministry announced that the armed forces's modernisation budget would be slashed by around Rs 10,000 crore (Rs 100 billion) in the forthcoming Budget.
The Rafale deal would have to wait for the next financial year, along with the artillery guns modernisation programme (Rs 20,000 crore/Rs 200 billion), and the creation of a new mountain corps to counter China (Rs 65,000 crore/Rs 650 billion).
In the plan expenditure, the government has already allotted Rs 55,000 crore (Rs 550 billion) for the MMRCA deal. But this was five years ago and cost escalations are bound to have crept in, which might prove to be a serious problem.
The Times of India commented: 'The move will lead to a major slowdown in the ongoing acquisition projects. It also makes it clear that the already much delayed $20 billion MMRCA project to acquire 126 fighters will not be inked anytime before March 31.'
Though the IAF had been promised an additional Rs 10,000 crore to cater for the first installment of Rafales, defence expert, Major General Mrinal Suman (retd) told The New Indian Express that the budgetary cuts would impact 'all acquisitions in the pipeline, as they become easy targets.'
A gloomy scenario
It is in these circumstances that a new development occurred -- Foreign Minister Salman Khurshid visited Paris last week. While many had doubts about the deal, Agence France Press reported that India could buy up to 189 Rafales instead of the 126.
Apparently, Khurshid raised the possibility of an additional 63 jets being added to the shopping list. A source told AFP: 'There is an option for procurement of an additional 63 aircraft subsequently for which a separate contract would need to be signed.'
The deal would then mean a staggering $18 billion contract, which would be a great boon for the French defence industry, but costly for India though Indian suppliers could secure work equivalent to 50 per cent of the total value with the clause currently under negotiations.
Khurshid seemed confident during his visit to Paris. 'We know good French wine takes time to mature and so do good contracts. The contract details are being worked out. A decision has already been taken, just wait a little for the cork to pop and you'll have some good wine to taste.'
His counterpart Laurent Fabius said, 'The final decision belongs to the Indian government in its sovereignty. But from what I am told by my colleague minister of India things are progressing well, and I can confirm the full support of the French government.'
Another issue which might slightly delay the deal is that the IAF requires two-seater jets and not the one-seater model presently produced by Dassault, but this should be solved in due time.
The People's Daily had said, 'The delirious and bustling feeling of excitement from the French side resembles the behavior of Fanjin, which had a fit of madness upon learning that he was successful in the three-year provincial tests (under the Ming and Qing dynasties).' It is not exactly the attitude of the French (and the Indian) authorities who are progressing slowly, but surely towards an agreement, which is very important for both countries.
One can however understand that the Chinese are nervous.
Major General Luo Yuan, a well-known Chinese expert on military issues, recently quoted the ancient Art of War: 'The best policy in war is to thwart the enemy's strategy; the second best is to disrupt his alliances through diplomatic means; the third best is to attack his army in the field; the worst policy of all is to attack walled cities,' his conclusion was that to thwart the enemy's strategy, deterrence is the key.
It is valid for India too; too much delay in the 'deal' won't be good.
The Real Reasons for Rafale’s Indian Victory
(Source: defense-aerospace.com; published Feb. 1, 2012)
By Giovanni de Briganti
PARIS --- While many observers cite technology transfer, prices and performance as being major factors in India’s selection of the Rafale as its next-generation fighter, reality is very different even if these factors obviously did play a significant role.
In the same way that it is true that Rafale lost several competitions through no fault of its own, it must be recognized that its victory in India was also won, to a great extent, through no fault of its own. The real reason for its victory is political, and the long memory of Indian politicians was a major contributing factor.
This is not to say, however, that Rafale’s own impressive qualities had nothing to do with its selection. The Indian Air Force, which was extensively briefed by the French air force in the autumn, was particularly impressed by its operational performance during the Libyan bombing campaign and in Afghanistan. Rafale also has a naval variant which could be of future interest to India, given its plans to buy and build aircraft carriers, while the recent decision to upgrade India’s Mirage 2000H fighters will simplify the air force’s logistics chain, as these will share with Rafale many weapons and other equipment.
The Indian Air Force also is a satisfied user of long standing of French fighters, going back to the Dassault Ouragan in the 1950s. It was also particularly appreciative of the performance of its Mirages during the 1999 Kargil campaign against Pakistan, and of the support it then obtained from France. During that campaign, India obtained French clearance – and possibly more - to urgently adapt Israeli and Russian-supplied laser-guided bombs to the Mirages, which were thus able to successfully engage high-altitude targets that Indian MiG-23s and MiG-27s had been unable to reach.
Rafale was preferred because of lower costs, and the Indian air force's familiarity with French warplanes such as the Mirage, Bloomberg reported Feb. 1 quoting an Indian source who asked not be named. "Unit-wise, the French plane is much cheaper than the Eurofighter. Moreover, the Indian air force, which is well equipped with French fighters, is favouring the French," the source said.
To Indian officials, France’s steadfastness as a military ally contrasted strongly with that of the United States, which stopped F-16 deliveries to Pakistan (but kept the money) when it found it expedient to do so, and slowed or vetoed delivery of components for Light Combat Aircraft that India was developing. And, of course, the 1998 arms embargo, decreed by the US after India’s nuclear test in May of that year, left a very bad taste in Indian mouths. France, on the contrary, was the only Western nation not to impose sanctions on that occasion.
That, Indian sources say, was New Delhi’s real reason for eliminating Boeing and Lockheed Martin from the fighter competition; India has resolved, these sources say, to buy only second-line equipment from the U.S., such as transport (C-17, C-130J) or maritime patrol aircraft (P-8I). Vital weapons such as missiles and fighters, when they cannot be locally produced, will remain the preserve of France and Russia.
Political considerations were also a significant factor playing against Rafale’s final competitor, the Eurofighter Typhoon. As this aircraft is produced by a consortium of four nations, each with different foreign policies and different attitudes and tolerances to arms exports, Indian officials were a bit nervous about their ultimate reliability as a single supplier.
Germany is a long-standing Indian aviation partner, and a respected role model for Indian politicians, many of whom were educated there. German companies – essentially the former Messerschmitt-Boelkow-Blohm, now part of EADS - helped Hindustan Aeronautics Ltd. develop both the LCA and the Advanced Light Helicopter, now called Dhruv. These links were the reason the Eurofighter bid was led by Germany’s Cassidian, and not BAE Systems, the former colonial power. But Germany had dithered over technology transfer for LCA, soft-pedaled on ALH tech transfer when German pacifists raised their eyebrows, and coughed when India almost went to war with Pakistan over Kargil and Kashmir, so in the final analysis it could not be considered a reliable supplier of major weapons.
Italy has never sold a major weapon to India, and so could bring neither influence nor reputation to support Eurofighter, while the third partner, Spain, is totally absent from the Indian military landscape.
This left BAE Systems as the best-known Eurofighter partner in India, and so by default as its ultimate public face. BAE in 2003 sold £1.5 billion’s worth of Hawk jet trainers to India, with a follow-on, £500 million order in 2010. However, its previous major sale to India was the Jaguar light attack aircraft in the 1970s. In fact, this aircraft was jointly developed by Britain and France on a 50/50 basis, and while it was license-produced by HAL it was never really successful as a fighter. Furthermore, France could claim as much benefit from its Indian career as BAE.
Taken together, the Eurofighter partner nations posed an even thornier problem: in case of war, German law prohibits deliveries of weapons and spares, Italian law and public opinions would demand an embargo, while Spanish legislation is murky. What would happen, Indian politicians must have wondered, if after buying the Eurofighter they went to war? Would spares and weapons be forthcoming, or would they be embargoed? The political risk was obviously too big to take.
Weapons also played a significant role in persuading India to opt for Rafale: not only is its weapons range mostly French-made, and thus not subject to a third-party embargo, but so are all of its sensors. Eurofighter, whose air-to-air missiles include the US-made AIM-120 Amraam and the German-led IRIS-T, and whose primary air-to-ground weapon is the US-made Paveway, was obviously at a competitive disadvantage in this respect.
Furthermore, the Rafale is nuclear-capable and will replace the Mirage 2000N in French service as the carrier of the newly-upgraded ASMP/A nuclear stand-off missile; it is also capable of firing the AM-39 Exocet missile, giving it an anti-ship capability that its competitors do not have. India is also interested in fitting its BrahMos supersonic missile to a wide range of its combat aircraft, and Rafale could apparently carry it.
Given that India had sworn to buy the cheapest compliant competitor, it would have been unable to justify picking the Rafale had this not been offered at the lower price. While official figures have not been released, and indeed may never be, initial reports from New Delhi claim that Rafale was offered at a unit price of $4-$5 million less than Eurofighter, which is a surprisingly large advantage given the French aircraft’s reputation of being high-priced.
The French offer also featured substantially lower costs of ownership, according to the same reports, thanks to lower fuel consumption and simpler maintenance requirements.
If true, these figures imply the French offer undercut Eurofighter by over $600 million, which is a large enough difference for one French insider to wonder whether Dassault Aviation will ever make any money on the contract.
But, even if it doesn’t, the Indian contract gives Rafale instant legitimacy, not only because of the thoroughness and transparency of the bidding process, but also because India is the only country to have fought four and a half major wars since 1948, and so knows something about air combat.
For Dassault, the Rafale program will now remain active, with a stabilized production line, for decades to come, and the company will have that much more time to find additional customers. Keeping its production line and supply chain humming at an economically-viable rate are sufficiently valuable achievements to push immediate profits into the sidelines. Supporting 126 – and possibly 206, if India buys an optional second batch – combat aircraft, and providing spares, fixes and upgrades over the next 40 years, will generate gigantic profits, and this more than justified lowering Dassault’s notoriously high profit margins.
In fact, as one industry official noted, "this is France's answer to 'Al Yamamah', but with twice as many aircraft," drawing a parallel with the UK's sale of Tornado fighters and related services to Saudi Arabia, which was instrumental in keeping BAE Systems prosperous throughout the 1980s and 1990s.
And, as French Defense Minister Gérard Longuet told reporters during an impromptu press conference in Parliament, France may soon find “that good news travels in formation,” implying that further, long-deferred contracts might soon be announced.
I also remember that ToIlet had reported that the price difference between Rafale and ef2k was huge amount of 10,000/- crore Rs.