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CAG’s Rafale Report May Compare Cost of Deal With Rival Offers, to be Tabled in Lok Sabha Today

News18.com
The CAG notes that the deal signed under the NDA waived off bank guarantee allowing Dassault to make a savings of an unspecified amount in ‘bank charges’.

New Delhi: The Comptroller and Auditor General Report on the controversial Rafale deal may compare the terms of acquisition of the French fighter jet with the offer made for its only competitor, the Eurofighter Typhoon Jet, which is manufactured by the European Aeronautic Defence and Space Company (EADS).

The Rafale and the Eurofighter jets were the two shortlisted for acquisition by the Indian Air Force after technical trials among six competitors. The other contenders were the single engine US made F-16 and F-18 Super Hornets, the Swedish Gripen, and the Russian Su-35.

The CAG report on 11 acquisitions by the IAF is in two volumes, sources told News18. While volume one deals with 10 air acquisitions, volume two deals with the Rafale deal. The two volumes have been printed together.

Sources have also confirmed to News18 that that price of the 36 Rafale jets will be masked (redacted) in the CAG report. "We have two reasons to mask the price. One national security and second the contract signed between government of France and India about non-disclosure of prices, "a CAG officer said on the condition of anonymity.

The CAG, has instead, gone into percentage terms while comparing the terms of the Rafale acquisition with the terms offered by the only competitor, according to media reports.

Under the original MMRCA (medium multi-role combat aircraft) deal to buy 136 fighter jets, for which a tender was floated by the previous UPA government, Rafale had emerged as the lowest bidder.

But after the bids were opened, EADS had offered a 20% discount on the deal to the National Democratic Alliance (NDA) government. The discount was offered in comparison to the price it originally quoted in 2008 and re-quoted in 2010. The government had ignored the offer as it would have violated Defence Procurement Procedure guidelines.

But the MMRCA negotiations got stalled and the Narendra Modi government inked a new Rs 59,000 crore deal to acquire 36 Rafale fighters in a fly away condition from Dassault Aviation. The deal was an inter-governmental one, signed with France in September 2016.

The CAG findings will be tabled amid media reports that say that the Prime Minister’s Office conducted parallel negotiations with France on the Rafale deal had “undermined” the position of the Indian Negotiation Team, and that the government had waived crucial anti-corruption penalty clauses in the deal days before the inter-governmental agreement was signed.

Opposition parties have also questioned the impartiality of the current CAG, Rajiv Mehrshi, in the audit, as he was an official in the Finance Ministry during the Rafale negotiations. Congress president Rahul Gandhi, at a press conference, had termed it as “chowkidar auditor general report”, alleging that it was “for and by the chowkidar”, in a barb at PM Modi.

He also alleged that Anil Ambani knew about the deal even before Modi announced it, and this amounts to a violation of the Official Secrets Act.

The Finance Ministry on Monday issued a statement that an accusation against Mehrishi was “totally a figment of imagination and stretch of facts”. The finance ministry said Mehrishi, as Economic Affairs Secretary, never dealt with expenditure proposals from the Defence Ministry.