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1. Rafale cost is 2.86% lower, but Dassault benefited without bank guarantee: CAG

The contract signed in 2016 to acquire 36 Rafale fighter jets from France through the Inter-Governmental Agreement (IGA) was 2.86% lower in value than “Audit’s aligned price” of the bid received in 2007 when the then UPA government had sought to purchase 126 Medium Multi-Role Combat Aircraft (MMRCA), the Comptroller and Auditor General (CAG) of India said in its report, tabled in Parliament.

The CAG also observed that the price could have been reduced further had the benefits of waiving of the bank guarantees for the vendor (Dassault Aviation) been passed on to India.

Varying claims

There have been varying claims from government officials on how much cheaper the 2016 deal was, with estimates ranging from 9% to 20%.

On the delivery schedule, the national auditor found that the 2016 deal’s terms would ensure only a month’s advantage over the timeline offered in the 2007 bid.

The report, which had been widely awaited in the wake of a string of revelations on procedural deviations in the negotiations to acquire the French Rafale jets and political allegations of financial irregularities in the deal, was tabled in the Rajya Sabha on the last day of the 16th Lok Sabha.

In its performance audit report on ‘Capital Acquisition of the Indian Air Force’, the CAG reviewed 11 contracts signed between 2012-13 and 2017-18 with an approximate value of Rs. 95,000 crore.

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