HAL, Dassault Aviation Had 'Serious Differences' When UPA Was Negotiating Rafale Deal: Sources

New Delhi: There were “serious differences” between Hindustan Aeronautics Ltd (HAL) and Dassault Aviation for production of Rafale jets in India when the UPA government was negotiating the deal with the French company, official sources said on Thursday.

The previous UPA government in 2012 started negotiations with Dassault Aviation to buy 126 Medium Multi-Role Combat Aircraft (MMRCA). The plan was for Dassault Aviation to supply 18 Rafale jets in fly-away condition, while 108 aircraft were to be manufactured in India by the company along with HAL. However, the deal could not be sealed.

Sources said the HAL, in a letter dated October 11, 2012, to the defence ministry, brought out various disagreements pertaining to the work share between HAL and the Dassault Aviation, the makers of Rafale jets.

Subsequently, in July 2014, HAL in its letter to the ministry has also highlighted one major unresolved issue regarding responsibility sharing between Dassault Aviation and HAL for licence manufacture of the aircraft, the sources said.

They said observations by experts that the HAL was capable of manufacturing Rafale jets was incorrect. "There were serious differences between HAL and Dassault Aviation when the UPA government was negotiating the deal with the French company," a source said.

Last week, defence minister Nirmala Sitharaman said negotiations for procurement of 126 Rafale jets under the UPA government fell through as HAL did not have the required capability to produce the jets in India in collaboration with Dassault Aviation.

After rounds of negotiations with Hindustan Aeronautics Ltd (HAL), Dassault Aviation felt that the cost of the Rafale jets will escalate significantly if they were to be produced in India, she said.

The Congress has demanded answers from the government on why HAL was not involved in the new deal. In 2016, the Modi government signed a government-to-government deal with France for purchase of 36 Rafale jets at a cost of Rs 58,000 crore. The Congress has been alleging irregularities in the deal.