Amid allegations by the Congress that the NDA government is procuring Rafale combat aircraft at inflated prices, government sources said under the deal being negotiated by UPA , 36 aircraft would have cost at least Rs 9,120 crore more than what the Modi government has contracted for with France.
The NDA government signed a deal worth around Rs 59,280 crore with France in September 2016 under which France's Dassault Aviation would supply 36 planes to the Indian Air Force (IAF) in fly-away conditions to meet the force's emergency requirements.
"If we compare the cost of the aircraft to have been procured in fly-away condition under the medium-multi role combat aircraft (MMCA) tender, which was scrapped due to complications, 36 aircraft would have cost 9 billion euros ( Rs 68,400 crore) against 7.8 billion euros (Rs 59,280 crore) contract done by the NDA government," a top government source told Mail Today.
The sources were comparing the per unit cost of 18 aircraft to be bought in fly-away condition under the MMRCA tender where 108 units were to be manufactured in India while 18 were to be procured off the shelf with the 36 planes being bought under the inter-governmental agreement.
The first 18 planes under negotiations in the MMRCA tender would have cost 4.5 billion euros ( Rs 34,200 crore) approximately, they said.
Congress spokesperson Randeep Surjewala has alleged a scam in the deal and sought to know from the Prime Minister as to why the planes were bought at such inflated costs.
"Is it not true that as per the UPA negotiated price, the cost of one plane was Rs 526.1 crore whereas under NDA, the plane is costing Rs 1,570 crore?" Surjewala had asked the government recently.
Sources said the capping of inflation at 3.5 per cent as part of the deal signed in 2016 would also result in saving of a minimum 200 million euros (Rs 1,520 crore) in the times to come.
They said there is no point comparing the cost of the Make in India component of the MMRCA deal as the cost of manufacturing in India is always very high and it would be unfair to compare.
Under Make in India, the original equipment manufacturer would have had to set up a completely new manufacturing plant for production of aircraft, which would have added a significant amount to the deal while deployment of foreign personnel in India would have also cost money.
Top national security sources have said that along with a lesser price, the government has also ensured that the country gets a more capable aircraft from the French side which will also ensure that at any point of time, 75 per cent of the aircraft are available for operations.
"We are getting a better deal in terms of avionics and weaponry as we will get longer range air-to-air missiles where the French would maintain the aircraft for 10 years," a source said.
Surjewala has alleged that the Modi government violated the Defence Procurement Procedure (DPP) and bypassed the interests of PSU Hindustan Aeronautics Limited (HAL).
The Congress leader claimed that while the UPA government had signed the Rafale deal as a joint venture between its French maker, Dassault Aviation, and India's HAL, the Modi government cancelled the entire process on July 30, 2015.