Home / Breaking News / CAG report on Rafale deal tabled in Parliament: Key points | India News

CAG report on Rafale deal tabled in Parliament: Key points | India News

* The inter-governmental contract for Rafale was 2.86 per cent lower than the earlier aligned price.

* The CAG rejected defence ministry’s argument that 2016 contracted price of 36 basic flyaway aircraft was 9 per cent lower than the price offered in 2007.

* However, CAG said in the previous offer of 2007, Dassault Aviation had provided performance and financial guarantees which was about 25 per cent of the total value of the contract.

* The vendor had embedded this cost in its bid price. But in the 2016 contract there are no such guarantees or warranty. This led to saving for Dassault Aviation which was not passed on to India.

* Four of the Indian specific enhancements were not needed at all because in the technical evaluation of 2010, the IAF had pointed out these were not needed.

* However, they got included in the scope, despite IAF making several attempts to reduce these items.

* IAF did not define the Air Staff Qualitative Requirements (ASQRs) properly. As a result none of the vendors could fully meet ASQRs.

* ASQRs were changed repeatedly during the procurement process which created difficulties during technical and price evaluation, and affected the integrity of competitive tendering.

* It was also one of the main reasons for delays in the acquisition process.

* The objectivity, equity and consistency of technical evaluation process was not evident in the technical evaluation report.

* The vendor response to solicitation of offers was low, which restricted competition.

* The delivery schedule of the first 18 Rafale aircraft is better than the one proposed in the 126 aircraft deal, by five months.

* The federal auditor has taken more than a year-and-a-half to review the Rafale deal and has gone into its pricing, request for proposal received from competitors, and also analysed comparative pricing of other fighter jets available globally.

* The CAG’s is a standalone one on all offset deals of the MoD of the past five years, a draft report of which has already been sent to the government for its response. However, the report may not be finalised before the general elections.

* The report on the offset deals, being prepared separately, includes the review of offset agreements in the Rafale deal where the opposition had raised objections of favouring Reliance of the Anil Ambani group, which is a key offset partner of Dassault Aviation in the Rafale deal.

(With agency inputs)

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