NDA's Rafale deal 2.86% cheaper than price negotiated by UPA in 2007: CAG

The Rafale deal signed by the Modi government to procure 36 fighter jets from France's Dassault got 2.86 per cent cheaper price than what was negotiated during the previous UPA regime in 2007, the much-awaited CAG report on the controversy-hit transaction showed on Wednesday.

Without disclosing pricing details in absolute terms, the Comptroller and Auditor General (CAG) also said the deal was 6.54 per cent expensive in terms of engineering support package and performance-based logistics for the Indian Air Force, while the training costs has got 2.68 per cent expensive than the 2007 offer.

The CAG also flagged the drawbacks of settling for a 'Letter of Comfort' rather than a sovereign guarantee by the French government and said Dassault benefitted due to absence of such guarantees.

The report, however, was silent on the issue of offset partners, which has been a key point on which the Congress has been attacking Narendra Modi-led government and has been alleging corruption in Anil Ambani's Reliance Group getting one of the offset contracts.

Soon after the report was tabled in Parliament, Union Minister Arun Jaitley said the lies of the Congress and opposition parties stand exposed as the CAG report outlines that 2016 deal terms were lower in terms of price, faster in terms of delivery, while ensuring better maintenance and lower escalation.

On India-specific enhancements, CAG said the NDA deal was 17.08 per cent cheaper than the one negotiated by the then UPA government in 2007, while the weapons package offered in the new deal was 1.05 per cent cheaper, the 157-page report said.

For the overall price, the CAG has said the new deal is 2.86 per cent cheaper.

Defence Minister Nirmala Sitharaman has earlier said the deal struck by Modi government was 9 per cent cheaper than what was being negotiated by the Congress-led UPA government.

Congress, on the other hand, has been alleging that the price increased to Rs 1,600 crore per aircraft in the deal signed by the Modi government, as against Rs 520 crore during the UPA time.

In its report, the CAG has highlighted the drawbacks of settling for a 'Letter of Comfort' rather than a sovereign guarantee by the French government. It noted that the deal which was being negotiated in 2007 included a 15 per cent bank guarantee against advance payments.

The training aspects covered under the deal is also 2.68 per cent expensive than the 2007 offer, the report said.

In the 2007 offer of 126 fighter jets, Dassault Aviation was to provide basic training to 26 pilots and 76 technicians at a certain cost. In 2015 deal for 36 Rafale fighter jets, the IAF increased the scope of training to 27 pilots, 146 technicians and two engineers.

The Modi government has been facing a torrent of attacks by Congress and its chief Rahul Gandhi over the fighter jet deal.

Gandhi on Monday had dubbed the CAG report on the Rafale deal as "Chowkidar Auditor General" report.

"That CAG report is a worthless report. I would term it as a 'Chowkidar Auditor General Report'. It is Narendra Modi's report, written for the chowkidar, on behalf of the chowkidar, for the chowkidar, by the chowkidar," he had said on Monday.

Following the report becoming public on Wednesday, Union Finance Minister Arun Jaitley hit out at the main opposition party.

"It cannot be that the Supreme Court is wrong, the CAG is wrong and only the dynast is right. Satyameva Jayate" - the truth shall prevail. The CAG Report on Rafale reaffirms the dictum," Jaitley tweeted.