Rafale deal: Differences between HAL, Dassault led to collapse of talks

Disagreements between Hindustan Aeronautics Limited (HAL) and Dassault Aviation led to the collapse of negotiations between the two in the Rafale fighter plane deal during the UPA term.

According to Defence sources, HAL in a letter to Ministry of Defence (MoD) in 2012 mentioned the differences with Dassault pertaining to workshare.

In July 2014, HAL in a subsequent letter to MoD also highlighted one major unresolved issue regarding responsibility sharing between Dassault and HAL for license manufacture of aircraft. Besides, the man hours required for the manufacture of various components of the aircraft in HAL was also a point of disagreement between the two.

"Due to all these reasons the proposals for 126 MMRCA could not progress further," sources said

According to a media report, T. Suvarna Raju, former chairman and managaing director (CMD), claimed that Dassault and HAL had signed the mutual workshare contract and given it to the government. He further said that the life-cycle costs of the aircraft would have been cheaper if the aircraft were made in India.

Responding to this, sources said that since the workshare between Dassault and HAL was never agreed upon, reports claiming lower life cycle cost of the planes, was completely "presumptive" and termed the media report based on HAL ex-CMD statement as "factually incorrect".

The opposition parties have been blaming NDA Government for not taking on board HAL in the Rafale deal and questioned Dassault's tie up with Reliance Group under off-set clause.