Dassault 'Rafael' back at Aero India 2013, but hopes of rivals still soaring

The winner of India's biggest deal, French Dassault 'Rafael' is back at the Aero India 2013, but hopes of those who were not selected for the IAF $10.4 bn deal are still high as the cumbersome process of price negotiations are nowhere near completion.

Apart from the lengthy process of CNC, other factors are looming large over the much coveted deal which include inter alia the impending general elections of 2014, economic recession and the subsequent cut in defence budget .

"The contract negotiation is going on, a process which is 6-7 layers. Later it will be sent to the ministry of finance. We are trying to speed up the process," the defence minister AK Antony said in response to a question.

The minister also made it very clear that the RfP that was issued is the final document of reference and no changes would be made to it.

This is indicative of the fact that somewhere the deal has run into trouble and maybe the French are putting pressure on the Indian government for making changes.

Highly placed sources told FE on condition of anonymity that soon after Dassault emerged the lowest bidder (L-1) beating its rival Eurofighter on life cycle costs, French side has been demanding more money for the transfer of technology and is not very comfortable on the production of the fighter machines at a later stage at state owned Hindustan Aeronautics Limited (HAL).

"The Dassault team that visited the HAL facility in Nashik and were disappointed by the infrastructure there," sources added.

As reported by FE earlier, the ministry of defence had turned down Dassault's assertion that if it is given the overall responsibility of the project, it should be given the freedom to decide on the quantum of work to be shared between HAL and private companies in the programme.

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