Turbulence In The Sky

Cut out the nonsense, there is no Uncle Quattrocchi in the Rafale deal

 

10/12/2018 1:45:55 AM
written By : M J Akbar Print

The best antidote to nonsense is surely common sense. Check this out on the Common Sense Index.

The total cost of the 36 Rafale strike aircraft for the Indian Air Force, upgraded with latest assault capability, was reportedly around Rs 58,000 crore. Congress president Rahul Gandhi claims that there has been corruption of Rs 45,000 crore on this purchase through subsidiary, future business, known as “offsets”, to one particular industrialist.

Why should any foreign manufacturer sweeten someone else’s life to the extent of Rs 45,000 crore in order to get a contract of Rs 58,000 crore? The math simply doesn’t add up. We know that Mr Gandhi is talking about this limited order of 36 planes, and not the proposed full order of 126 Rafales, because in a tweet timed 7.22pm, July 27, he claimed, with pseudo-linguistic winks, that the “benefit” to this industrialist would be “20 BILLION US$”.

The language is juvenile, but the imagination is fertile. The $20 billion figure has quietly disappeared from discourse because Mr Gandhi’s highly compensated advisers clearly felt that, even by the standards of Pinnochio, this was ludicrous overkill.

If common sense junks these fabrications, facts demolish them. Let us take the accusation at the core of this propaganda: the lie that Rafale is overpriced. In March 2012, the UPA government accepted a price of Rs 538 crore for the bare aircraft, along with a price escalation clause that by May 2015 would have taken the cost to Rs 737 crore. The present government has bought the bare aircraft a year later for Rs 670 crore, which is 9 per cent less.

The bare aircraft however is exactly what it says it is: bare. It is only a cockpit craft with radar, a passenger plane for one pilot who can perhaps see the enemy on radar and then freeze into impotence. With the necessary weaponisation needed for a multi-role combat machine, the price, by UPA-accepted specifications, would have gone to Rs 2,023 crore per aircraft. The present government has further enhanced strike capacity, technology, equipment, performance-based logistics, added earlier delivery — and brought down the total cost by nearly 20 per cent. Rahul Gandhi compares the price of an impotent, bare Rafale to that of a superb fighting machine that will fill a yawning hole in India’s air security, and believes he can fool the people of India.

This price reduction is because of a commitment given by France to Prime Minister Narendra Modi in the joint statement on April 10, 2015, that the Rafale would be procured on “better terms” than those negotiated with UPA. “The two leaders agreed to conclude an Inter-Governmental Agreement (IGA) for supply of the aircraft on terms that would be better than conveyed by Dassault Aviation as part of a separate process underway...” Further, once the contract moves through the IGA route, it has to be approved by the Competent Financial Authority and due diligence. The process, including Defence Procurement Procedure, is a legal requirement.

Mr Gandhi’s process, on the other hand, consists of nothing more nuanced than flinging numbers in the air, without an iota of evidence, and hoping that some of the dirt will stick.

Take the requirement of offsets, which obliges Dassault to allot future business on maintenance or spare parts to Indian companies. The government of India has no role in the distribution of this business. Mr Gandhi always suggests that only one particular company, part-owned by Anil Ambani, will get subsidiary contracts once the need arises three or four years down the line. The fact is that there are 72 such companies, including BEL and DRDO in the public sector and Tata in the private sector. The total worth of orders to be spread among 72 companies is estimated to be Rs 30,000 crore. You have to be weird to believe any company can make Rs 45,000-crore profits out of Rs 30,000 crore worth of orders that will be divided between 70-plus firms.

If you question Congress leaders, they will accept, in muted tones, that no bribe has been paid. Unlike in deals like Augusta Westland helicopters, or HDW submarines, or the famous Bofors guns. There is no “Uncle Quattrocchi” this time. For those who may not remember, Ottavio Quattrocchi was an Italian businessman operating out of India, who became such a close friend of the Gandhi family that he was a virtual “Uncle” to Rahul Gandhi. Quattrocchi was the conduit for bribes paid in the purchase of Bofors guns in the 1980s. The last favour he got in India was during the UPA era, when his frozen bank accounts were released by the law ministry.

It has been wisely said that telling the truth is easier than telling lies. Lies must be protected by sustainability; the truth does not vary. As finance minister Arun Jaitley noted in his scathing blog, Rahul Gandhi claimed from Karnataka in May that the price of each bare Rafale was Rs 700 crore; in Parliament this was deflated to Rs 520 crore; in Raipur he raised it to Rs 540 crore — and in Jaipur he offered two figures (Rs 520 crore and Rs 540 crore) in one speech.

As they say in the digital age, a lie flies halfway across the world while the truth is putting on its boots. But truth has now put on its boots, and is kicking lies out of the ballpark

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