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Neither HAL’s, nor IAF’s interests served: Nirmala Sitharaman

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New Delhi: Defence Minister Nirmala Sitharaman on Tuesday lashed out at the erstwhile UPA government for not finalising a deal for buying the Rafale aircraft and thereby failing to take care of the interests of the IAF.

She also claimed that the State-owned Hindustan Aeronautical Limited (HAL) was ousted from the Rafale deal during the UPA regime. The deal negotiated by the UPA in 2012 failed because French firm Dassault Aviation could not agree on production by HAL, she explained. “Thus, neither HAL’s interests, nor IAF interests, were taken care of,’’ she hit back at the Congress in a theatrical tone.”

Asked if there would be an investigation into talk of alleged kickbacks during UPA negotiations on the Rafale deal, the Defence Minister said, “I have not used the word investigation at all. They are rumours. Let the rumours gain strength. Rumours and rumours!’’ she exclaimed. Replying to questions during an 80-minute media interaction, Sitharaman said that the UPA government should have made the terms appealing enough for Dassault to conclude a deal with HAL. ‘‘So, this entire issue about HAL not being chosen, is not for us to answer.”


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‘‘What we have done after talking with Dassault Aviation is to reach an inter-governmental agreement with France for procurement of 36 aircraft in flyaway condition,’’ she added. On why the government did not buy 126 fighter jets the IAF had originally sought under UPA, if PM Modi’s deal was cheaper, Sitharaman said: “We ordered as many aircraft as we required. The deal could not have been clinched if we had asked for more, as buying 126 required a longer time frame.” The defence minister also said PM Modi’s deal was 9% cheaper than the one the UPA dispensation had agreed upon.

“Look, your basic price and the basic price I am getting the aircraft for, when compared, with all the escalation and other things taken into account, is nine per cent cheaper. And this cost of the basic aircraft is already in Parliament.’’ On questions about Anil Ambani’s name in context of the Rafale deal, Sitharaman said, “I have not put his name or anybody else’s name in the Inter-Governmental Agreement.” She also said her ministry had no say in the selection of the Indian partner by the foreign vendor.

Asked why offset was being passed on to a private venture in Rafale purchase, she said: “This rule that an Original Equipment Manufacturer, who is abroad after having sold something to us, can go and invest or buy a product for offset obligation fulfilment, can do it in private or public sector, is a rule that existed during the UPA regime. They had given the option to OEM to go and put his investment in any place — public sector or private? So, do you say that your rule was wrong? Will they concede that their rule was wrong?”

To a question that PM Modi had gone ahead with the Rafale deal but ignored the life cycle cost, Sitharaman said, “Prime Ministers and Presidents do not sit and discuss the technical details. The technical teams go into the details. I am not trying to undermine the seriousness of it. The approval for the deal to be signed was obtained from the CCS (Cabinet Committee on Security) and due procedures were followed.’’

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