Rejecting Congress president Rahul Gandhi’s allegation that he lied about details of his company’s joint venture with Anil Ambani-led Reliance Group for offset contracts in the Rafale fighter deal, Dassault Aviation CEO Eric Trappier has denied any wrongdoing, saying “I don’t lie”. On the pricing issue, Trappier said the present aircraft are “cheaper by 9 per cent” and the “price of Rafale in flyaway
condition is less expensive in the 36 contract than the 126 contract” — he was referring to the Medium Multi-Role Combat Aircraft (MMRCA) contract for 126 Rafale that never materialised under the UPA.
In an interview to news agency ANI in the Dassault hangar at the Istres-Le Tube Air Base north of Marseille, Trappier, responding to a question on Gandhi’s allegation that Dassault was covering up for possible cronyism in awarding the offset deal to the Anil Ambani-led Reliance Group, said: “I don’t lie. The truth I declared before and the statements I made are true. I don’t have a reputation of lying. In my position as CEO, you don’t lie.”
At a press conference on November 2, Gandhi said that Trappier had lied about the Rafale deal to protect the Modi government. He had alleged that Dassault invested Rs 284 crore in a loss-making company promoted by Anil Ambani which was used to procure land in Nagpur. “It is clear the Dassault CEO is lying. If an inquiry starts on this, Modi is not going to survive it. Guaranteed,” he said.
Trappier said they had prior experience dealing with the Congress party and the comments made by the Congress president made him sad.
“We have a long experience with the Congress party. Our first deal was with India in 1953 with Nehru and other Prime Ministers. We have been working with India. We are not working for any party. We are supplying strategic products like fighters to the Indian Air Force (IAF) and the Indian Government. That is what is most important,” he said.
Asked about the reason behind Dassault’s choice of Reliance as an offset partner which had no experience in manufacturing fighter jets, Trappier said: “We are not putting the money in Reliance. The money is going into the JV. I put my knowhow free of charge on how to produce people. I have engineers and workers from Dassault who are taking the lead as far as the industrial part of this deal is concerned. At the same time, I have an Indian company like Reliance which is putting money into this JV as they want to develop their country. So the company is going to know how to produce aircraft.”
On investments being made by Dassault, he said Reliance would match the amount since the shareholding pattern is 49 per cent Dassault and 51 per cent Reliance as per prescribed government norms.
“We are supposed to put in this company together about Rs 800 crore as 50:50. For the time being, to start work in the hangar and to pay workers and employees, we have already put Rs 40 crore. But it will be increased to Rs 800 crore, which implies Rs 400 crore by Dassault in the coming five years,” he added.
He said Dassault has seven years to perform offset. “During first three years, we are not obliged to say with who we are working. We have already settled work and agreement with 30 companies, which represents 40 per cent of total offset obligation as per contract. Reliance is 10 per cent out of the 40, while rest 30 per cent is a direct agreement between these companies and Dassault.”
On the pricing issue, the CEO said that the present aircraft are cheaper by 9 per cent. “Price of 36 was exactly the same when you compare with 18 flyaway. 36 is the double of 18, so as far as I was concerned, it should have been double the price. But because it was government to government, there was some negotiation, I had to decrease price by 9 per cent. The price of Rafale in flyaway condition is less expensive in the 36 contract than the 126 contract,” he said.
Asked about the initial agreement with HAL and the subsequent breakdown of talks, Trappier said if the initial deal for 126 Rafale had gone through, Dassault would not have hesitated to work with HAL and Mukesh Ambani-led Reliance.
“It’s because the 126 didn’t go smooth that the Government of India had to reconfigure to urgently acquire 36 from France. And then I took the decision to continue with Reliance, and HAL even said in the last few days that they were not interested to be part of the offset. So, it has been done by my decision and the decision of Reliance to invest in a new private company,” he said.
According to the CEO, Dassault was earlier in discussions with several other companies for offset tie-ups. “Obviously, we could have gone to Tata or other family groups. At that time, the decision to go ahead was not given to Dassault. We were in 2011, Tata was also discussing with other flying companies. We finally decided to go ahead with Reliance as they have experience in big engineering facilities,” he said.
On the the aircraft, Trappier said the present fighters will have all necessary equipment but not weapons and missiles. “The weapons will be sent in different contract. But the aircraft with everything other than weapons will be dispatched by Dassault,” he said.