Reliance, Dassault sealed the deal during UPA rule: BJP's counter to Rahul

Prasad alleged there was pressure for extraneous considerations and 'bribe' for not finalising the Rafale deal during the UPA rule.

Describing Prime Minister Narendra Modi as a symbol of honesty after Congress president Rahul Gandhi threw the ‘thief’ barb at him, the Bharatiya Janata Party on Saturday rejected former French president Francois Hollande's sensational claim on the Rafale deal, saying it does not know under what compulsion he said so.

BJP leader and Law Minister Ravi Shankar Prasad also said that Dassault Aviation, the manufacturer of the fighter aircraft, and Reliance had entered into an agreement as early as 2012 when the Congress-led United Progressive Alliance was in power as he refuted the allegation that the Modi government had favoured the Anil Ambani-led company.

Ruling out Gandhi's demand for a joint parliamentary committee probe into the deal, he told a press conference that it cannot be done merely to satisfy the ego of ‘an arrogant and ill-informed leader repeating lies after lies’.

Prasad also cited statements of the French government and Dassault in which they said Indian and French dispensations had no role in picking the offset partner of the private company, to brush aside the charge of corruption.

He sought to discredit the claim of Hollande, who had said that the Indian government has proposed Reliance as an offset partner, saying that French journalists have spoken about his ‘conflict of interests’.

It is none of our concern, he added.

The BJP leader raked up a number of cases of alleged corruption involving the Gandhi family to launch a stinging attack on the Congress president, saying his family is the ‘source of corruption’ in the country.

No prime minister of India has been spoken of in a manner Gandhi did about Modi, he said, terming his comments as ‘irresponsible and shameful’ and that he had painted his face black with such remarks.

"We cannot expect anything better from Gandhi. He has no quality, no capability and whatever he is he owes to his family... Modi is a symbol of honesty and a global leader," Prasad said, claiming that doors for middlemen and power brokers have been shut under his government.

Prasad said the UPA government terminated negotiations with Dassault after a contract negotiation committee had chosen it as the lowest bidder in 2012 following years of process because the company did not pay it ‘bribe’.

There was pressure on the company for ‘extraneous considerations’, he said, adding that Modi decided to go ahead with the Rafale deal after coming to power in May 2014 as Indian Air Force needed fighter aircraft urgently and the entire exercise had been dragging on for several years.

He also alleged that Gandhi was ‘helping’ Pakistan and had been playing into the hands of India's ‘enemies’, by demanding that the government reveal full price details of the deal.

He said Gandhi and his mother Sonia Gandhi are on bail in a case of corruption, a reference to the National Herald matter, and alleged that his family had taken bribe in the Bofors case.

The country cannot expect any better from a leader who kept quiet while his brother-in-law looted land, Prasad said, in a reference to cases involving Robert Vadra.

Prasad reiterated the government's claim the basic price of Rafale negotiated by it was nine per cent cheaper than what the UPA had agreed to while its fully weaponised version was 20 per cent cheaper.

In 2012, when Dassault signed the agreement with Reliance, the company was led by Mukesh Ambani. Anil Ambani is his younger brother. Whatever happened between the two brothers is their matter, Prasad said.

'We have no role in selection of Reliance Defence'

The government on Saturday said it did not have any role in the selection of Reliance Defence as partner by Dassault Aviation for the Rafale deal after it came under attack over former French president Francois Hollande's reported remarks that Paris was given 'no choice' on the Indian associate for the mega contract.

The defence ministry said 'unnecessary controversies' are being sought to be created following media reports regarding a statement purportedly made by Hollande concerning the selection of Reliance Defence as the offset partner by Dassault, the manufacturers of Rafale aircraft.

'The government has stated earlier and again reiterates that it had no role in the selection of Reliance Defence as the Offset partner,' the ministry said.

The statement by the ministry came a day after French publication Mediapart quoted Hollande as saying that the Indian government proposed Reliance Defence as the partner for French aerospace giant in the Rs 58,000 crore Rafale deal and France did not have a choice.

The Dassault Aviation has chosen Reliance Defence Ltd (RDL) as the Indian partner to fulfil offset obligations of the deal and both companies have already announced setting up of a joint venture to manufacture aerospace components.

The opposition parties have been accusing the NDA government of favouring the RDL over state-run aerospace behemoth Hindustan Aeronautics Ltd. The government has been maintaining that it has no role in selection of RDL by Dassault Aviation.

'The reported statement perhaps needs to be seen in its full context -- where the French media has raised issues of conflict of interest involving persons close to the former President. His subsequent statements are also relevant in this regard,' the ministry said, seen as a reference to a recent media report linking the Rafale deal with a film by Hollande's partner Julie Gayet.

The report had said Ambani's Reliance Entertainment had signed an agreement with Gayet to produce a film before the Rafale deal was sealed. Hollande, who was France's president when procurement of 36 Rafale jets was announced in April 2015, rejected the report.

'Incidentally, media reports of February, 2012 suggest that Dassault Aviation, within two weeks of being declared the lowest bidder for procurement of 126 aircraft by the previous government, had entered into a pact for partnership with Reliance Industries in defence sector,' the defence ministry said.

The previous UPA government was negotiating with Dassault Aviation for procurement of 126 Rafale jets under which 18 jets were to supplied in a fly-away condition and 108 were to be manufactured in India by the French company along with HAL. However, the UPA could not seal the deal.

In its statement, the defence ministry said the joint venture between RDL and Dassault Aviation is a 'purely commercial arrangement' between two private companies. The joint venture came into force in February, 2017.

It said the offset can be discharged by many means such as direct purchase of eligible products and services, FDI in joint ventures and investment towards equipment and transfer of technology.

"As per Defence Offset Guidelines, the foreign Original Equipment Manufacturer (OEM) is free to select any Indian company as its offset partner."

Under India's offset policy, foreign defence entities are mandated to spend at least 30 per cent of the total contract value in India through procurement of components or setting up of research and development facilities.

The ministry also referred to a press release issued by Dassault Aviation stating that the company has signed partnership agreement with several companies and is negotiating with hundred odd other companies.

"As per the guidelines, the vendor is to provide the details of the offset partners either at the time of seeking offset credit or one year prior to discharge of offset obligation, which in this case will be due from 2020," said the ministry.

The Congress has been accusing massive irregularities in the deal, alleging that the government was procuring each aircraft at a cost of over Rs 1,670 crore as against Rs 526 crore finalised by the UPA government when it was negotiating procurement of 126 Rafale jets.

'Rahul should think before levelling allegations'

Union Home Minister Rajnath Singh on Saturday advised Congress president Rahul Gandhi not to make allegations against the government on the Rafale issue without proof.

Singh said the verification of the French media report will reveal the truth.

"The government has issued a statement on the issue. Let the verification of the report take place. It will clear the situation, it will reveal the truth," Singh told reporters in Amreli.

The home minister, who was in Amreli to attend a meeting of the cooperative societies sector, went on to advise Gandhi that he should not make allegations without proof.

"One should think four times before levelling any baseless allegation. One should not make allegations without proof," Singh said to a question on what he would like to tell Gandhi who has been dragging the name of Prime Minister Narendra Modi in the deal.

The Congress, meanwhile, alleged that Union ministers Arun Jaitley and Nirmala Sitharaman made 'false statements' on the Rafale deal and demanded that they resign from their posts.

All India Congress Committee spokesperson S Jaipal Reddy told reporters, "Mr Arun Jaitely and Mrs Nirmala Sitharaman both said, both in the House and outside, that they did not know...Government of India did not know. This has been proved to be wrong by the statement of former President of France (Francois Hollande)."

He alleged that the ministers 'misled the nation' on the issue.

"I, therefore, demand that the two ministers who made false statements, though under the pressure of the prime minister, with regard to the role of the government in the choice of Anil Ambani's company, should resign immediately," Reddy said.