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CAG report on Rafale deal: Lies of 'Mahajhootbandhan' stand exposed by the report, says Arun Jaitley

CAG Report on Rafale: India has managed save 17.08 per cent money for the India Specific Enhancements in the 36 Rafale contract, says report.

twitter-logoBusinessToday.In | February 13, 2019 | Updated 17:47 IST
CAG report on Rafale deal: Lies of 'Mahajhootbandhan' stand exposed by the report, says Arun Jaitley
Finance Minister Arun Jaitley on the CAG report on Rafale.

CAG Report on Rafale deal: The CAG report on Rafale deal is being tabled in the Rajya Sabha today. The auditor report has endorsed several claims of the Narendra Modi government, including pricing and delivery of the 36 fighter jets. The report says that the government clinched the deal at prices 2.86 per cent lower than the one negotiated during the previous UPA government. It also says that the delivery schedule of the first 18 Rafale aircraft was "better" by around five months than the one proposed in the 126 aircraft Rafale deal. India managed to save 17.08 per cent of the cost for the India Specific Enhancements in the 36 Rafale deal, adds the report.

Follow BusinessToday.In live blog for all the latest updates on the CAG report on the Rafale deal.

4.45 pm: PM Modi: Hum sunte the ki bhookamp aayega, par koi bhookamp nahi aya. Kabhi hawai jahaaz uday gaye, lekin loktantra ki maryada itni unchi hai ki koi hawai jahaz uss unchchai tak nahi ja paya.

4.40 pm: This House passed the laws to fight the menace of black money and corruption. This House also passed the GST bill: PM Modi.

4.35 pm: We are proud of this 16th Lok Sabha, as it has the highest number of women members elected to the House. Forty-four first time women MPs were time elected to the Lok Sabha: PM Modi.

4.30pm: PM Narendra Modi in Lok Sabha: 3 dashak ke baad ek purn bahumat wali sarkaar bani aur azaadi ke baad pehli baar Congress gotra ki nahi hai aisi sarkaar bani hai. Congress gotra nahi aisi milijuli pehli sarkaar Atal ji ki thi aur aisi purn bahumat wali sarkaar 2014 mein bani.

4.15pm: PM Modi speaks in Parliament. "Several sessions in this Lok Sabha had good productivity. This is a very good sign," says Prime Minister Narendra Modi.

2.52PM: Based on recommendations from the INT, the government approved the procurement of 36 Rafale aircraft from Dassault in August 2016.

2.50PM: The CAG report pointed out that an Indian Negotiation Team (INT) was formed with the consent of Defence Minister to achieve the following objectives:

  • To expedite the delivery of Rafale aircraft and weapons.
  • To bring down the cost of procurement.
  • To obtain offsets to support 'Make in India' campaign.
  • To obtain better terms and conditions in respect of warranty and product support.

2.17PM: Important points agreed during the Rafale deal with France.

  • The 36 Rafale jets would be acquired as quickly as possible.
  • An IGA would be signed for the supply of the aircraft on terms that would be better than conveyed by M/s Dassault Aviation as part of a separate process underway
  • The delivery would be in time frame that would be compatible with the operational requirement of IAF aircraft along with weapon and associated systems would be delivered in the same configuration as had been tested and approved by IAF and with a longer maintenance responsibility by France.

2.15PM: "The Staff Evaluation Report had recommended for waiving of noncompliance of Rafale aircraft to four ASQR parameters as they were not needed in the first place. Three of these parameters were not put up to the RM for waiver by the DG Acquisition stating that they should be negotiated with the L1 vendor during CNC. This was never taken up by CNC during negotiation as recommended by Ministry even though it had significant price implication. Most importantly Audit noted that carrying over technical issues to price negotiation was incorrect," says the report.

2.13PM: "Two aircraft viz., Eurofighter and Rafale were cleared based on their presentation in the lab as to how they proposed to meet the shortcomings in meeting certain ASQRs. Therefore the aircraft were technically accepted without evaluating the significant modification/ enhancements made on them," said the report.

2.10PM: "As per the TEC report, Rafale aircraft had failed to meet 14 ASQR parameters. SER stated that the non-compliance of the three parameters viz "W1", "W2" and "W3" mode of radar would not have any operational impact. In addition SER also recommended for waiver of one more parameters ("W4"). Further, Audit independently noted that two of the ISEs viz. "W5" and "W6" proposed by the vendor were apparently not needed in the first place as the detailed field evaluation trial report 64 had noted them to be satisfactory," says the CAG report.

2.07PM: "The Audit observations are divided into two parts. Part A highlights the issues related to the process for acquisition of 126 aircraft with Transfer of Technology. Part B delineates the issues related to acquisition of 36 Rafale flyaway Aircraft through an IGA after the negotiations for 126 aircraft had come to a standstill," says the report.

2.02PM: "India is a leading importer of arms and spends about `78,000 crore on an average annually on capital acquisition of defence system. The share of Indian Air Force (IAF) is about 40 per cent of the total defence capital acquisition budget. Further, IAF spends 65 per cent of its total budget on capital acquisitions," reveals the CAG report.

1.41PM: Senior Congress leader Mallikarjun Kharge on the CAG report: "The Centre is prejudiced who have already made a decision, so this report holds no value. Secondly, there is a conflict of interest. The man who was then a negotiator is now preparing the report," reported ANI.

1.07PM: The Rajya Sabha has been adjourned indefinitely. Earlier, Motion of Thanks was passed on the President's Address, Interim Budget 2019-20; no discussion was held in the House.

1.07PM:Components expensive during the NDA deal:

  • Performance-based logistics (6.54 per cent expensive)
  • Engineering support package (6.54 per cent)
  • Tools, Testers and Ground Equipment (TTGE) NDA deal (0.15 per cent)

1.00PM: If someone has to be given a tag of 'mahajhootha' or an award for it then he'll be the first contender.

12.57PM: Union Finance Minister Arun Jaitley says the lies of 'Mahajhootbandhan' stand exposed.

12.53PM: Components cheaper during the NDA deal:

  • Product and services, equipment related to operational support and technical assistance, documentation process, and programme management (cheaper by 4.77 per cent).
  • India specific enhancement (17.08 per cent cheaper)
  • Weapons package (1.05 per cent cheaper)

12.43PM: The Congress party leaders, including party chief Rahul Gandhi, UPA chairperson Sonia Gandhi and former PM Manmohan Singh, protest oustide Parliament against the Rafale deal.

12.39PM: Senior Congress leader P Chidambaram contradicts the BJP government claim; says the Chapter 4 of the CAG report clearly says "a costlier aircraft and a longer delivery period". 12.38PM: Union Minister Nitin Gadkari says it is clear the BJP deal was better than the UPA deal. "The Congress should now refrain from attacking PM Modi".

12.34PM: Arun Jaitley slams the government, says can both the SC and CAG be wrong?

12.33PM: The NDA deal was cheaper and better.

12.24PM: The audit notes the IAF did not define the ASQRs (Air Staff Qualitative Requirements) properly.

12.18PM: "Satyameva Jayate - the truth shall prevail," Finance Minister Arun Jaitley tweets.

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