Looks like the real thing to me –

After hard bargain, Rafale deal price finalised

Nearly four months after Prime Minister Narendra Modi and French President Francois Hollande signed a memorandum of agreement (MoU) to purchase 36 Rafale combat jets, negotiating teams from either side have narrowed down their differences.

Sources with first-hand knowledge of the discussions reveal that the Indian team has managed to hammer down the price for the deal from some 11 billion Euros demanded by the French to about 7.89 billion Euros after three months of sustained and hard negotiations. The expectation is that the final deal will be clinched in another month’s time.

The deal comes with the clause of delivering 50 per cent offsets, creating business worth at least 3 billion Euros for smaller Indian companies and creating thousands of new jobs in India through the offsets. In fact, the toughest phase in the negotiations that began in July 2015—after three months Prime Minister Modi announced in Paris India’s plan to purchase 36 Rafale jets—was to get the French to agree to 50 per cent offsets in the deal.

Initially, Dassault Aviation was willing to agree to reinvest only 30 per cent of the value of its contract in Indian entities to meet the offset obligations, but India was insisting on a 50 per cent offset clause to be met. The French side finally agreed to invest 50 per cent of the value. The commercial negotiations, those involved in the negotiations point out, actually began on 15 January this year. Although both Modi and Hollande were keen to sign the complete deal during their summit meeting on 25 January—the negotiators bargain hard until 2 am on 25th January but failed to agree on a price—they both settled on a generic MoU in absence of a consensus.

Since then, both sides have had a series of discussions and sources now say price, offset and delivery schedule is more or less finalised. Once the final deal is sealed in middle of May—that is the outer deadline that both sides have set for themselves–the commercial negotiations can be said to have taken just five months after they actually began in January.

Under the proposed deal, French companies apart from Dassault Aviation, will provide several aeronautics, electronics and micro-electronics technologies under the offset obligation. Companies like Safran and Thales will join Dassault in providing state-of-art technologies in stealth, radar, thrust vectoring for missiles and materials for electronics and micro-electronics.

The first delivery of the combat jets, manufactured by French aviation major Dassault Aviation, will however take at least 18 to 20 months from the date of signing of the contract. The Indian Air Force (IAF) desperately needs new fighter jets since its combat jet strength has depleted alarmingly in absence of any new induction. The 36 jets however will not be sufficient to make up for the shortage. Once the Rafale deal is concluded, the MoD and IAF is likely to concentrate on drawing up another plan to acquire another batch of fighter jets manufactured under the Make in India programme. This tender, whenever finalised, will allow other major aviation majors worldwide to compete in the Indian market for fighter jets.

Given that both Hollande and Modi have invested a great deal of their own political capital in re-configuring the original unwieldy tender, government sources insist that the contract will be signed sooner than later. Once that happens, it will bring down the curtains of one of the world’s longest running competition to sell fighter aircraft for any air force anywhere in the world.

Still, it’s $1.9 bil for the helos alone (without engines??) + 1.4 bil for training, parts, ordnance and fifty engines. That is $3.3 bil for 22 helicopters if I am counting right..

I’m pretty sure that’s $1.4 bil for 22 AH-64E’s, all inclusive. Because the whole package, including 15 Chinooks was priced at $3 billion.

First of all THANKs a lot … and sorry, but I think I have to make one thing clear – as such @Vnomad I would beg to change that quote since it now looks to be my quote !:

Yeah. Sorry. My bad.

Hi guys … again me with a probably stupid question, but since there’s a harsh discussion started by a new member going on in one China-forum around that theory, I would like to get some facts …

o.k. here are his claims:

“Since no other Russian warplane is designed for the AL31FN, it is ludicrous to think that Russia will specially designed another engine just for China J-10A indigenous fighter”

I suggest you ask your friend which Russian warplane is powered by the RD-93. Unless he thinks the RD-33 was modified without Russian involvement.

Check the timelines. According to swedish wiki, if I understand that correctly, 30 aircraft with an option for another 110 were ordered in 1982. In 1992, the option changed to 110 firm orders. In 1997, the last batch of 64 was ordered. In 2004, it was decided to reduce the numbers to 140 Gripen. 2006 that was reduced further to 100 Gripen.
Meanwhile, the last Drakens retired in 1991, various Viggen variants from 1993-2004. So actually, the draw-down after the cold war reached well into the 00s.

The way I see it, Cold War ended at the same time for all the states in question, so the SwAF’s circumstances could hardly have been unusual. The Rafale & Eurofighter were being developed on a time-table that was, broadly speaking, comparable with the Gripen. And the obvious response to any subsequent draw down (on budgetary grounds) would have been to roll back the production-rate to the bare minimum (as France did), and push hard on upgrades and the NG development, rather than writing off (what I assume were) perfectly functional and adequate aircraft.

And it’s not over yet, only 60 Gripen E ordered so far.

The situation is completey different for the other Eurocanards.

Under the current plan, when the Gripen E rolls around, instead of competing with the Rafale & EF, it’ll find itself pitted against an F-35 nearing peak production.

You are ofcourse right about the ratios, i.e. 150 out of 600 Typhoons vs maybe 300 out of 3000 F-35. There is a flaw however!

More like 100 out of 3000. After the LRIP 6 retrofit costs really bottomed out.

That was the case. I suggest you research how other european Air Forces were cut in the 90ies. Had the cold war not ended, Swedish AF probably would have ordered more than 204 Gripen. Ending production would have been an option if you wanted to break contracts and kill off the swedish aircraft industry.

Trouble with that idea is – most of the production contracts for the Gripen were signed well after the end of the Cold War. The deliveries of the A/B started in 1997 and were retired by 2012. The Rafale F1s and EF T1s delivered just a few years later (from 2000 and 2002 respectively), will both serve to 2030.