Dassault can also sign contracts

A Rafale during the Garuda exercises in Jodhpur in 2014

A few weeks ago, I mentioned on this blog, the long, very long negotiation process between Dassault Aviation and the Government of India to purchase 18 Rafales Multi Role Combat Aircrafts (MMRCA) and later built 108 Rafales in India in collaboration with Hindustan Aeronautics Ltd. (HAL).
Last week, a rather surprising development occurred.
A senior official of the Armament Procurement Agency (Direction générale de l’armement or DGA) of the French Ministry of Defence asserted that a 2012 agreement to provide Rafales to India never committed Dassault Aviation to guarantee aircraft manufactured in India.
For the first time, Paris openly sided with Dassault, a French family concern, in its talks with Delhi, the latter arguing that liabilities during the process of manufacturing 108 aircrafts in India, should be the French supplier's responsibility. For months now, this has been the main bone of contention between the 2 parties.
Laurent Collet-Billon, the DGA’s boss affirmed: “Dassault will not be responsible for the whole contract. It is a co-management setup.”
He also ‘clarified’ that France will not assume full liability for the HAL-built aircrafts: “It cannot be a problem, because it was not in the request for proposals (RFP),” he added. It is not what the Indian Ministry of Defence says.
Speaking to reporters on February 9, Collet-Billion also admitted: “A lot of progress has been made since 2012.” The French official however latter agreed that the negotiations should "give way to a contract for the 126 fighters plus 63 options".
After several failed attempts to export the French plane, the DGA has learned patience: “India has its own pace. ...It’s not useful to put pressure on the client. We have to live with our differences."
As far as Dassault is concerned, the French Air Force should be ordering 11 Rafales in 2015, but just four in 2016, and have a break of near 2 years due to budget constraint. Collet-Billon admitted that “Problems will [then] occur, if we don't export Rafales."
During the same press conference, the DGA's official mentioned a possible deal with Egypt for 24 Rafale fighters, a FREMM frigate and a number of missiles.
Nobody really took note of this.

Dwindling number of squadrons
In a meantime in India, the Parliamentary Standing Committee on Defence expressed some concern “over the dwindling number of fighter squadrons in the Indian Air Force. The squadron strength has come down to 25 from the sanctioned 42.” The Committee’s report which was tabled in the Parliament, stated that the Indian Air Force (IAF) required at least 45 fighter squadrons to counter a ‘two-front collusive threat’, while the government has sanctioned  42 squadrons only: “The revelation is astonishing, and the committee feels that the paradox in the required and sanctioned strength needs to be rectified at the earliest,” commented the Committee.
The IAF should maintain 32 squadrons of 18 aircrafts each. The committee noted: “Moreover, 14 of these squadrons are equipped with MiG-21s and MiG-27s, which will retire between 2015 and 2024. Thus the strength will be reduced to just 11 squadrons by 2024. Our capability has already come down.”
The Committee added that though the IAF has inducted several ‘force multipliers’, such as airborne early warning systems (AWACS), mid-air re-fuellers and tactical airlift aircraft, the dwindling fighter strength operationally means that the supremacy that India has enjoyed over its neighbours is fast eroding.
The Parliamentary Committee particular expressed its concern about the ‘laxity’ of the Government which, according to the members, ‘compromises national security’. The government has been requested to take concrete steps expeditiously to address this.

The Rafale Mirage
On February 9, nobody had taken Collet-Billion’s declaration about the talks with Egypt seriously.
A few days later, an article in the daily, Le Monde compared the Rafale to a ‘mirage’ (also the name of the Rafale's illustrious predecessor). The writer asked “can the sale to Egypt change the tide”. He cited a ‘litany of disappointments’, i.e. Brazil (2103), Arab Emirates (2011), Switzerland (2011), Korea, Nederland (2002) or Saudi Arabia.
About Egypt, the journalist concludes « Nothing can be taken for granted; one of the specialties of the Rafale is to provoke ‘mirages of sale’: “first the tension mounts, then the negotiators get excited, the politicians are enthusiasts, the signature is programmed, 3, 2, 1 …” and plouf, nothing happens.
He quotes one of the characters of Gaston Lagaffe comic, Monsieur Aimé De Mesmaeker, a business man who always announces that he will soon sign an all-important contract with the comic publication Journal de Spirou ...and episodes after episodes, the contract is never signed.

This time Mesmaeker-Dassault has done it
A contract between Dassault and Egypt has been signed for 24 Rafales. French President François Hollande yesterday announced that Egypt will buy 24 planes and a frigate for an amount of Euro 5 billion ($5.7 billion).
Speaking at a news conference after a European summit in Brussels, the French president said the contract is 'a triumph for French industrial policy and the action of the state', which has intervened to guarantee part of the financial deal: “We’ve missed out on contracts several times over the last 10 years, probably because there wasn’t the will to accompany the talks, to finance and conclude a deal,” he added.
Mr. Hollande explained: “Egypt wanted this plane quickly because of the threats surrounding the country.” He also mentioned that France is also expecting an order from Qatar.
Interestingly, an extremely tired French President (after overnight marathon talks for Ukraine at Minsk and the EU summit in Brussels), first confused Egypt and India, announcing the contract for 24 jets was …with India.
He later rectified: “It’s confusion perhaps from tiredness, but also maybe from hope,” he commented on his own lapsus.
Regarding the differences between India and Dassault mentioned by the DGA’s boss, it is clear that if there is 'the will to conclude a deal' from both sides is present, a compromise can be found, as it was done in the case of the nuclear liabilities with the United States just before the visit of President Obama to India.
After all, it would in the interest of both, India and France to have the contract signed at the earliest (for example, during the visit of Mr. Modi to France in April, ).
The contract with Egypt is also interesting in the sense that one of the main arguments of the anti-Rafale lobby has been that Dassault has not exported any plane so far. Now, this argument is not valid anymore.
It perhaps explains that the deal was negotiated and signed in a record time (hardly 3 months); Dassault wanting probably to prove that it can also sign contracts.