Jaitley rules out JPC on Rafale fighter jet deal

Finance minister Arun Jaitley said there will be no joint parliamentary committee (JPC) probe on the deal with France to buy 36 Rafale fighter jets made by Dassault Aviation.

“To satisfy the ego of an ill-informed gentleman, there are no options,” said Jaitley in response to a question on whether setting up a JPC is an option to quell the noise around the deal at a media briefing on Wednesday evening. Jaitley was referring to opposition leader and Congress president Rahul Gandhi calling for a JPC on the deal, alleging that the deal was struck at a price much higher than the actual value of the aircraft.

Jaitley’s media briefing came after reports of a 150-minute presentation made by Ajit Doval, national security advisor, and Ajay Kumar, secretary, defence production, to the council of ministers.

“Congress party has proved, that in dynastic parties, ignorance is contagious. If one person has lack of knowledge then the entire party suffers from lack of knowledge,” said Jaitley, reiterating the points stated by various leader of the government in past two years.

Gandhi had alleged that the deal’s offset clause is for the benefit of Reliance Group chairman Anil Ambani at the cost of public sector enterprise Hindustan Aeronautics Ltd. The allegations have been denied by the government and Ambani.

The core of the government’s denial to Gandhi’s allegation is that the price per aircraft now is actually 9% less than the price agreed to by the Manmohan Singh government. The prices haven’t been revealed officially but when the Inter-Governmental Agreement between India and France was signed in September 2016, Reuters reported that the deal was close to €7.8 billion.

The deal is to purchase 36 aircraft off-the-shelf and includes a 50% offset clause, wherein Dassault Aviation will have to invest in India and transfer technology to its Indian partner for manufacture of more Rafale fighter jets. Delivery of the jets off the shelf begins in September 2019.

“The question of benefitting a private businessman in this deal does not arise as we are purchasing readymade aircraft which would be built in France,” said Jaitley.

“Please understand our policy. So far Congress’ policy has been to import defence products 100%. But we won’t manufacture in India. During the [time of] the late Atal Bihari Vajpayee we opened defence sector to 26% foreign direct investment as an experiment. It had limited effect and foreign companies complained why would they share technology with 26% share in a venture. We changed the limit to 49%. This has had great success,” said Jaitley giving examples of tie-ups such as the one between Lockheed Martin and the Tata group.