After the CAG report on the Rafale deal saying the French firm Dassault aviation has so far not made good on its offset obligation to the Defence Research and Development Organisation (DRDO), Congress leader P Chidambaram on Thursday launched an attack on ruling BJP.
In a tweet, the Congress leader said, “CAG finds that the vendors of the Rafale aircraft have not confirmed the transfer of technology under the offset contract.”
“The offset obligations should have started on 23-9-2019 and the first annual commitment should have been completed by 23-9–2020, that is yesterday. Will the government say if that obligation was fulfilled? Is the CAG report the opening of a can of worms?” he added in another tweet.
The offset obligations should have started on 23-9-2019 and the first annual commitment should have been completed by 23-9–2020, that is yesterday. Will the government say if that obligation was fulfilled?
Is the CAG report the opening of a can of worms?
— P. Chidambaram (@PChidambaram_IN) September 24, 2020
CAG of India in a report tabled in parliament criticised the Defence Ministry’s policy for offsets and said that the French firm Dassault aviation has so far not made good on its offset obligation to the Defence Research and Development Organisation (DRDO).
As per the offset policy, a certain percentage of the deal value with foreign firms should flow into India as foreign direct investment. This in-flow of funds would include technology transfer, local manufacturing of advanced components and creating jobs.
“In the offset of four contracts relating to 36 Medium Multi Role Combat Aircraft (MMRCA), the vendors Dassault Aviation and MBDA initially proposed (September 2015) to discharge 30 per cent of their offset obligation by offering high technology to DRDO,” the Comptroller and Auditor General or CAG said in the report tabled in parliament, referring to the Defence Research and Development Organisation.
DRDO wanted to obtain technical assistance for indigenous development of engine (Kaveri) for the Light Combat Aircraft. Till date the vendor has not confirmed the transfer of this technology,” the CAG said. The policy of offsets has “not yielded the desired result,” the top auditor said.
“The (Defence) Ministry needs to review the policy and its implementation. It needs to identify the constraints faced by the foreign suppliers as well as the Indian industry in leveraging the offsets, and find solutions to overcome these constraints,” the report said.
The Indian Air Force has inducted the Rafale aircraft on 10 September at Air Force Station, Ambala. The aircraft will be part of 17 Squadron, the “Golden Arrows”.
The DRDO has been involved since the project began over three decades ago.
During the Rafale negotiations, France agreed to help India work on an upgraded Kaveri engine. It promised to achieve with better thrust that can potentially replace the American engine.