Rafale deal: A Damocles’ Sword over NDA?

What started as a non-serious allegation against the BJP-led NDA government in regard to deal for 36 Rafale fighter jets now seems to be emerging as a major controversy and the latest weapon for the Congress to attack the NDA government in general and Prime Minister Narendra Modi in particular.

The Congress tried to highlight the issue during the monsoon session of the Parliament when AICC president Rahul Gandhi launched a scathing attack on Modi and Defence Minister Nirmala Seetharaman claiming that the later had told untruth under pressure from the Prime Minister.

“Everyone knows the relationship Modi has with a few business people, and everyone can see the amount of money that goes into his marketing. One of them was given the Rafale contract. Prime Minister Modi has not been truthful and that is a fact,” Rahul said during his speech on no confidence motion. This was strongly refuted by the Prime Minister as well as the Defence Minister.

In fact, the scathing attack against the Prime Minister got drowned and the manner in which Rahul Gandhi walked up to the seat of the Prime Minister and hugged him and winked in the Lok Sabha invited sharp criticism. The BJP alleged that he was indulging in indecent and childish acts. The Prime Minister who is known for his silence outside was at his best in making fun of Rahul Gandhi for his acts.

But as the elections are now drawing nearer, allegations are flying thick and fast between the two parties which could perhaps match the speed of the aircraft. The statement of the former French President François Hollande that his government ‘did not have a say’ in the choice of Anil Ambani's Reliance Defence Ltd as a strategic partner for the controversial Rafale fighter jet deal is in sharp contrast with the position the Government of India had taken on the floor of the Lok Sabha.

This has now become the latest weapon for the Congress saying that their stand has been vindicated by the former French president. The Congress is going to town claiming that the Rs 58,000 crore jet fighter deal has been badly handled since 2015. The Congress hopes that this could breathe some high dose of oxygen into its poll campaign and cause impact during the elections in the five States Chhattisgarh, Rajasthan, Madhya Pradesh, Mizoram and Telangana to some extent. It feels that this could be sort of another Bofors case which rocked the Rajiv Gandhi government in late 1980s.

The then Government of India had signed a Rs 1,437 crore deal on March 18, 1986, with Swedish arms manufacturer AB Bofors for the supply of 400 155 mm Howitzer guns for the Army. A year later, on April 16, 1987, a Swedish radio channel alleged that the company had bribed top Indian politicians and defence personnel to secure the contract. The scandal rocked the Union government led by Rajiv Gandhi. The entire Opposition resigned from the Lok Sabha.

On January 22, 1990, the Central Bureau of Investigation (CBI) lodged an FIR against the then president of Bofors Martin Ardbo, the alleged middleman Win Chadda and the Hinduja brothers for criminal conspiracy, cheating and forgery.
It was alleged that certain public servants and private persons in India and abroad had entered into a criminal conspiracy between 1982 and 1987 in pursuance of which the offences of bribery, corruption, cheating and forgery were committed. This was the first such incident when the Indian Prime Minister was implicated.

This time, the Congress perhaps wants to do a similar thing and use the Rafale deal as a stick to beat the government headed by Modi. It feels that this could be a stepping stone for the party to bounce back to power or at least as a major opposition.

Since the BJP too had failed to live up to its expectation of promoting cooperative federalism and has burnt its boat of friendship with many States which were either its allies or friendly ones, the Congress feels that it can succeed in forming a united opposition and can convert the Rafale issue into a lethal weapon to block the rise of the BJP in the 2019 elections.

Though this may not cut much ice in Telangana, it has the potential to cause some dent in Andhra Pradesh since people there are angry with the BJP for having failed to keep up its promise of hand-holding and for not fulfilling the assurances made by Modi before the elections. They are seething with anger over the manner in which the Centre had denied special status to Andhra Pradesh and for indulging in arm twisting tactics by not releasing funds for projects like Polavaram.

What is the Rafale deal?
The Rafale deal was in fact inked during the tenure of the UPA government in 2007 for purchase of 126 medium Multi Role Combat Aircraft (MMRCA) for the Air Force and post negotiations, two of them – Rafale and Eurofighter Typhoon — remained in the reckoning. However, Manmohan Singh-led dispensation could not finalise the deal.

Recently, the NDA government and France entered into an agreement for 36 Rafale fighter jets at a value of euro 7.87 billion, or about Rs 59,000 crore. The agreement includes a 50 per cent offset obligation, the largest-ever offset contract in the history of India. The main point of the offset agreement is 74 per cent of it has to be imported from India, which means direct business worth around Rs 22,000 crore.

Soon after the deal, Anil Ambani-led Reliance Group and Rafale maker Dassault Aviation had announced a joint venture (JV) that will be a “key player” in fulfilling the offset contract. The Congress is now alleging that the private player has benefited by crores. It is also demanding that the government should release the price at which the aircrafts were being purchased and contends that it cannot be a secret. It also finds fault with the statement of the Union Finance Minister Arun Jaitley that the UPA government never released prices of Defence purchases.

The Congress alleges that the NDA government had told lies that UPA government had not made the cost of defence purchases public. During his speech in Parliament, Rahul said, “To nail your lie, here are three Parliamentary replies by the UPA with full transparency on pricing. Now you ask our Raksha Mantri to tell India how much each RAFALE jet costs. Defence Minister Nirmala Seetharaman earlier said that she would tell the country about the cost. However, later she said it was a secrecy pact between both the countries (India and France). I asked the French President about this secrecy pact, but he denied the existence of any such pact. He even told me that he has no issues in making the cost public,” Rahul observed.

Former Defence Minister AK Antony claimed that the government cannot hide the price details of the Rafale jets as the deal has to be scrutinised by the Comptroller and Auditor General (CAG) as well as Parliament’s Public Accounts Committee (PAC). “They must reveal the price details of the aircraft and they must also tell us why a company was selected as offset partner which has no experience manufacturing aircraft,” Antony said.

This has pushed the NDA into a defensive position. However, it remains to be seen to what extent this issue will help in tilting the balance in favour of the Congress in the ensuing Assembly elections and if it can be another potential weapon like Bofors guns scandal to put the BJP in trouble. The opposition is even contemplating to reenact what had happened during Bofors scandal and explore the possibility of en masse resignations of MPs. But then much water has flown since 80s and that kind of opposition unity may be difficult now.