• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
BW Businessworld

France To Supply India 36 Rafale Fighter Jets

Photo Credit :

Indian Prime Minister Narendra Modi said on Friday he had ordered 36 "ready-to-fly" French-made Rafale fighter jets to modernise the country's ageing warplane fleet as neighbouring states upgraded their military hardware.
Indian military officials have warned that their air force risks a major capability gap opening up with China and Pakistan without new western warplanes or if local defence contractors cannot produce what the military needs in a timely manner.
"I have asked President (Francois Hollande) to supply 36 ready-to-fly Rafale jets to India," Modi said at a news conference on the first day of a state visit to France.
"Our civil servants will discuss (terms and conditions) in more detail and continue the negotiations," he said, speaking in Hindi through an interpreter.
The deal, another boost for French manufacturer Dassault Aviation after it sealed its long-awaited first export deal to Egypt in February, could be worth about 4 billion euros.
President Hollande said Defence Minister Jean-Yves Le Drian would travel to India soon to finalise the deal.
India and France have already been in exclusive negotiations for three years. The value of a larger 126-plane deal being negotiated is estimated to have grown to about $20 billion from an initial $12 billion, primarily because of an Indian requirement that 108 of the jets be built in the country.
A French defence ministry source said the deal announced on Friday was separate from the original negotiations and came about after new Indian Defence Minister Manohar Parrikar indicated the country's urgent requirements.
"We informed them we were ready to respond to their operational needs separate from the tender under discussion for three years," the source said.
India's military has said it needs to start replacing its ageing jet fleet from 2017.
"I had very good talks with President Hollande. Our defence sector ties are old. In defence equipment and technology. France has always been a reliable supplier. From fighter jets to submarines, our ties have been foremost," Modi said.
Operational Need
"There was a real operational need because India needs combat jets because a certain number of countries have been equipping themselves, so there was a desire to speed up the process," Dassault Chief Executive Eric Trappier told Europe 1 radio.
The country already has previous ties with Dassault, having bought Mirage 2000 fighter jets. In March, Dassault delivered two modernised Mirage jets to India.
Analysts say Dassault's deal with Egypt may have helped break the logjam in negotiations with other customers, since they are now on notice that if they want to have Rafales they may have to wait for them.
Since the Egypt deal, Dassault is in the "final stage" of negotiations to sell up to 36 Rafale warplanes to Qatar. It is also in talks aimed at supplying 16 of the multi-role combat jets to Malaysia and has resumed discussions over potential fighter sales to the United Arab Emirates (UAE), the source said.
Tensions in the Middle East, instability in eastern Europe and concerns in parts of Asia about regional border threats and the rise of China have further fuelled the arms race, but shifts and sudden reversals in the various industry talks are common.
17 Agreements Signed
India and France on signed 17 agreements, including on the stalled nuclear project in Jaitapur in Maharashtra, after Modi held wide-ranging talks with President Hollande.
An MoU was signed between Larsen and Tubro and Areva aimed at cost reduction by increasing localisation, to improve the financial viability of the Jaitapur project.
The agreement will also enable transfer of technology and development of indigenous nuclear energy industry in India.
Pre-engineering agreements were inked between NPCIL and Areva which intend to bring clarity on all technical aspects of the plant so that all parties (Areva, Alstom and NPCIL) can firm up their price and optimise all provisions for risks still included at this stage in the costs of the project.
After the two leaders held extensive talks, MoU was also signed between Indian Space Research Organisation (ISRO) and French National Centre for Space Studies (CNES) on the Indo-French Megha Tropiques satellite which was launched on board the Indian launch vehicle PSLV on October 12, 2011.
The MoU shall extend by two more years, the joint project for sharing and use of data from the satellite.
Under space cooperation, an agreement was also signed between ISRO and CNES. The agreement proposes cooperation in the areas of satellite remote sensing, satellite communications and satellite meteorology among others.
An MoU on cooperation between the Ministry of Youth Affairs and Sports and French Ministry of Sports, Youth Affairs, Public Education and Community Life was also signed that envisages cooperation and exchange of experiences in the fields of sports medicine and institutional cooperation.
The two countries also signed agreements increasing bilateral cooperation in the economic sector.
An MoU on cooperation in the field of renewable energy between the Ministry of New and Renewable Energy and France's Ministry of Ecology, Sustainable Development and Energy was signed that will help establish the basis for cooperation and relationship to encourage and promote technical bilateral cooperation on new and renewable energy issues on the basis of mutual benefits and reciprocity.
A Railway protocol between Indian Ministry of Railways and French National Railways (SNCF) was also inked, seeking to establish cooperation between Indian and French Railways for semi-high speed rail and station renovation.
France To Invest 2 Billion Euros
France has announced an investment of two billion euros in India as Modi invited French companies to invest in technology in the fastest growing economy.
Speaking at a CEO forum in Paris, Modi said, "There is no bigger market than India. It is also the fastest growing economy since the last six months. Various rating agencies like World Bank and Moodys have said in one voice that India is the fastest growing nation."
He said: "It is rare to find a country with a market, with the government determined on development and demographic dividend."
Addressing the forum, Hollande said: "We are ready to allocate through French companies 2 billion euros to support India's sustainable development." 

Top themes and market attention on: