Tuesday, June 15, 2021

Waste Of Money – Why Rafale Jet ‘Bribe’ Paid By Dassault Aviation To An Indian Middleman Was A Bad Deal?

A French media report claiming that Rafale fighter jet-maker Dassault Aviation having paid one million euros to an Indian middleman as a ‘gift’ during the 2016 Rafale deal has created a political storm in India.

According to an investigative report published by the Paris-based news website Mediapart, the irregularity was first detected by the French anti-corruption agency AFA upon examining a ‘suspicious payment’ made by Dassault Aviation to an Indian defense company in 2017-18.

The transaction was reportedly labeled as “Gifts to Clients” under “an expenditure by Dassault”, which the company justified by saying it was for the manufacture of 50 Rafale replica models, on 30th March 2017.

According to the news report, Dassault was unable to explain why it needed an Indian company to make models for a French aircraft that too at 2000 euros apiece. The company also failed to provide evidence to the anti-corruption agency of the ‘models’ envisaged to be manufactured under this agreement.

Mediapart claims to reveal a payment of one million euros made to a middleman related to the 7.8-billion-euro deal for the purchase of 36 Rafale jet fighters by India.

According to the Indian Defence Procurement Procedure, there can be no middleman or any payment of commission or bribe related to any defense deal. The failure to adhere to the rule can result in the defense company being barred from doing business with the country, including registration of FIR against the supplier.

Rafale-Jet
Dassault Rafale at Bengaluru IAF base (Photo by Younis Dar)

Dassault is reported to have paid the amount to one of its sub-contractors in India, Defsys Solutions, owned by Sushen Gupta, who was also accused of money laundering in March 2019 by the Enforcement Directorate, related to the AgustaWestland scam. Sushen was arrested and later released on bail, while the company continues to do business.

The Rafale deal has been repeatedly in controversies ever since the deal was first signed under the Congress government. Again in 2016, as the newly formulated deal of buying only 36 jets was completed, allegations of corruption were again exchanged between the opposition and the ruling party.

Later, the supreme court gave a clean chit to the Narendra Modi government on allegations of irregularities in the procurement of the jets in 2018.

However, the experts don’t smell a rat in the entire procurement process related to the multirole French fighter. The explanation is straight enough – there were too many reasons for India to go for Rafale and not choose any other jet.

Why Rafale Fighter Jets

As the strategic affairs analyst Nitin J Ticku explains, “the Indian Air Force has been a long-standing and happy user of the French fighter jets, starting its relationship with the Dassault Ouragan in the 1950s.

India has been highly appreciative of the performance of its French Mirages, which helped the country achieve major victories, including the 1999 Kargil airstrikes against Pakistan.

Even on a critical mission like Balakot, India sent its Mirage-2000 jets to bomb enemy hideouts (and not the latest Su-30 MKIs) across the border, which is a testimony to the amount of trust the IAF places on the fighter.”

Moreover, the Indian air force’s familiarity with French warplanes such as the Mirage makes the new arrangement easier, and there is a greater understanding and experience of working together, he adds.

Rafale and Eurofighter Typhoon were the two jets shortlisted in the Medium Multi-Role Combat Aircraft (MMRCA) competition. The problem with Eurofighter Typhoon was that it was owned by four different nations, each with its own foreign policy and attitudes towards foreign military sales, which made the Indian officials skeptical of their reliability.

And the most important reason for going for Rafale, as highlighted by the former Indian ambassador to France Rakesh Sood to The Print, was that the French did not mind modifications on the fighter to enable it to carry nuclear weapons. That capability modification was reportedly denied by the Typhoon consortium.

“On the other hand, Delhi was not so certain about the Eurofighter, as it would involve clearing it with multiple countries including Germany,” he told The Print.

Eurofighter is owned by Germany and Spain’s Airbus Defence and Space, with 46 percent stake, Britain’s BAE Systems with 33 percent stake, and Italy’s Leonardo with 21 percent stake.

“Germany has strong non-proliferation credentials, and New Delhi didn’t want to take a chance with Berlin making uncomfortable noises on this count, Sood added.

Experts also say the variety of weapons were also an important factor for India to purchase Rafale: India’s weapons range is mostly French-made, and therefore, any third-party embargo can never apply. Then there’s the same story with the sensors.

France A Vital Indian Ally

Coming to political reasons, France has been steadfast in its support for India on the international stage, and unlike the United States, can be relied on when India needs support on international forums such as the UN where the former holds a veto, Ticku adds.

Whereas, the relationship with the US can be complicated and mostly unreliable, especially when it comes to the military sale of military equipment. The US had stopped F-16 deliveries to Pakistan even when the country had made the payments, and when India was looking for components for its Light Combat Aircraft (LAC) which the country was developing, the former had either tried to veto or slow the deliveries. The US, therefore, could not be counted on.

One then reaches the conclusion that there wasn’t a worthy choice except the Dassault Rafale jets for the Indian government, thereby raising questions on the veracity of the reports of bribes or the involvement of commission in the procurement.

Any bribes, even if they did take place, were probably a waste and an unnecessary bargain.

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