Rafale Deal: "Exceptional & Unprecedented Waivers" Given By Modi Govt In Offset Contracts, Says Report

The Narendra Modi government gave “exceptional and unprecedented waivers” to Dassault and the European missile manufacturer MBDA in the offset agreements in the Rafale deal, The Hindu reported. The Hindu report is the latest in series of the comprehensive investigation into the controversial defence deal.

As per the report, the two companies were exempted from complying with certain provisions of the Standard Contract Document of the Defence Procurement Procedure (DPP-2013).

“Unprecedented waivers”

The report says that the waivers given were concerned with two key issues. The first one being the provisions made in the offset contracts for arbitration (as per Article 9) and the other being access to books of accounts of the industrial suppliers (Article 12).

The other two provisions of DPP-2013 that were “quietly dropped”- the one that prohibited against the “Use of Influence” and “Agents/Agency Commission” (Article 22 and 23); the other was penalising private industrial suppliers in case of transgressions.

The report also said that the French negotiators were not even ready for mentioning the word ‘offset’ in the Inter-Governmental Agreement’, but did so after discussions with the Indian side. The Hindu cited Indian Negotiating Team’s (INT) final report of July 2016 to support this argument.

The Hindu report further said that offset obligation of Rs 30,000 crore is loaded heavily on the last two years of the seven-year period. The vendors, including Anil Ambani’s Reliance Defence, will discharge 0% offset in the first three years.

Lesser fighter aircraft than what IAF required, favours to a crony who had set up a company weeks ago and now this: after dubious procedures with NSA negotiating directly in violation of processes. The corrupt Modi govt will be held to account for playing with National security. pic.twitter.com/kiRJZVuexb

— Sitaram Yechury (@SitaramYechury) April 9, 2019

Previous reports

The Hindu published several articles reporting multiple inconsistencies in the Rafale Deal. These reports were said to be based on several government documents. The first report said that the Prime Minister’s Office held parallel negotiation with the French side, another report, again by the daily said that the PM Modi-led government waived critical provisions for anti-corruption penalties. The report also said that the central government overruled the recommendations of making payments through an escrow account (an important safeguard in the absence of a sovereign or bank guarantee) days before the deal was signed.

PM Modi government’s Rafale deal for 36 flyway aircraft was not better than the previous government’s 126 aircraft deal, said the three senior Defence Ministry officials who were the domain experts on the seven-member Indian Negotiating Team (INT). This was unveiled in another report by The Hindu as part of their series on the Rafale Deal.

Also Read: “No One Can Force Us To Reveal Our Sources,” Says N Ram On Govt’s Accusations Of The Hindu Stealing Rafale Docs