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P Chidamabaram questions government's stand on Rafale deal, asks why wasn't HAL suggested as an offset partner

P Chidamabaram questions government's stand on Rafale deal, asks why wasn't HAL suggested as an offset partner

P Chidamabaram questions government's stand on Rafale deal, asks why wasn't HAL suggested as an offset partner
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By Shereen Bhan  Oct 26, 2018 6:27:30 AM IST (Updated)

P Chidambaram is a former finance minister and senior Congress leader. Chidambaram, 73, is a lawyer and an important member of the last Congress-led government.  In an exclusive interview to CNBC-TV18, Chidambaram questioned government's stand on Rafale deal and asks why wasn't Hindustan Aeronautics Ltd (HAL) suggested as an offset partner. He also said that the Congress will step up the campaign on Rafale deal before upcoming state elections but not looking at the issue as an election advantage.

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Edited Excerpts:
We have had the CEO of Dassault Aviation Eric Trappier on the channel today. He said that it was his decision to bring Anil Ambani's Reliance on board as an offset partner. He also said that that it doesn’t matter to them whether they had previous experience or not somebody has to start somewhere and they showed the willingness to do so and they have land which Dassault wanted?
What else will Dassault CEO say when his company is under attack for the deal they have entered in to with government of India? He has to defend himself. So, please ignore the context in which he is saying it. I heard him say that he chose a partner because the partner had land near an airport. I am not concerned with the partner.
Is he implying that HAL does not have land and Bengaluru does not have an airport? Second question, his company entered into a work share agreement on March 3, 2014, with HAL. That work share agreement is to produce components, parts etc... for aircrafts. Why did he cancel it? When he entered into that agreement, obviously HAL had land and Bengaluru had an airport. Nothing has changed.
I don’t think you should take these excuses seriously. The more important question is, why did the government cancelled the earlier MoU for buying 126 aircrafts and if they had negotiated a lower price why did they buy only 36 aircrafts. If somebody was offering me a lower price, I will buy all the aircraft that I want and all the aircraft that are on offer. 126 aircrafts was an offer, why did they not buy all 126 aircraft. I have raised a series of questions. Not one questioned has been answered.
On the Medium Multi-Role Combat Aircraft (MMRCA) deal and the 126 aircraft which was the negotiation that was started under the UPA and did not go through. The defense minister had said that this was an urgent requirement hence the government decided to do the 36 government to government (G-to-G) aircraft deal. The Dassault CEO today said that the 18 aircraft are part of the deal that was being negotiated under the UPA in fly-away condition and the 36 under this G-to-G deal in fly-away condition the price remains the same. So, this cost escalation that the UPA talks off is not true?
So, tell us the price.
That is a prerogative of the two government?
If the price is the same tell us the price. We know the price of the MoU which we had signed, Rs 570 crore, say that. If it is the same assert it as a same price and show us a document which says the same price. Secondly, what is the emergency purchase? You make an announcement in April 10, 2015. The first of those aircraft is expected to arrive in October 2019, four and a half years later. What is the emergency purchase where the first aircraft comes after four and a half year.
So you continue to raise questions, you have believed that the government has not provided you satisfactory answers. People like Yashwant Sinha, Prashant Bhushan and Arun Shourie have decided to move to Supreme Court as well as the CBI. What is the Congress intending to do other that raising this matter in the public domain?
The Congress Party is taking this issue to the people of India. One survey I saw said that 35 percent of the people are aware of the Rafale issue and of those, 50 percent of the people believe that there was something wrong in the deal. So, we have to step up the campaign which we will.
This campaign will be stepped up in the forthcoming five state elections. This will be even stepped up in the run-up to the Lok Sabha elections and by the time it comes, I have no doubt that over 80-85 percent of the people will be aware of this issue. Even if one-half of them believe that something is wrong then that will make a big difference.
What is the basis for the Congress’s claim that the CBI director Alok Verma has been sent out because of his to link to Rafale deal? In the Congress press conference by Abhishek Manu Singhvi said it is related to Rafale phobia what is the bases for making this claim ?
Because that is the buzz among journalists.
But it is buzz that you are going by?
I don’t know, I don’t have any first hand information. One that is the buzz among journalists, like you and people on the field. Number two the CBI director according to one newspaper report gave an audience to Prashant Bhushan and Arun Shourie who gave a formal complaint to the CBI Director.
So, one assumes that the CBI director will either dismiss the complaint or take it forward. Clearly, there was a complaint on his table on the Rafale deal. Now let the government tell us what the CBI director who is since being asked to go on leave what he did with that complaint. So, that will throw light on whether there is any truth to the allegations which is doing the rounds.
Let me end by asking you as far as Rafale specifically is concerned. This is a matter now that the Supreme Court is seized of. The Supreme Court has asked the government to respond without getting into things like price and so on. Do you really believe the fact that the Congress continues to take this issue forward that this is going to be an election issue that will work to your advantage?
We are not looking at it as an election advantage. This is clearly an issue. It cannot be wished away. It’s too big a contract and the manner in which the earlier MoU was summarily terminated without going through a cabinet committee and security, without the foreign secretary knowing about it until 48 hours before it was cancelled, without the defence minister knowing about it. It raises very serious issues.
The subsequent agreement entered into also raises serious issues. If the Air Force wants 126 aircraft which is 7 Squadron why are you buying only 2 Squadron? Are you not denying the Air Force its dues? Third question is, why you not suggested HAL as an offset partner. Let me assume for the sake of argument that Dassault has an absolute right to choose its offset partner, but if I am the government of India and I have a public sector undertaking (PSU) which is over 70 years old, which is a huge turnover of about Rs 18,000 crore and makes a profit about Rs 3,000 crore and today still manufacturers or assembles Sukhoi, Mirage, MiG, Tejas. I thought the natural thing for me to do is – fine Mr Dassault CEO, you go ahead and choose your offset partner but will you please consider my baby HAL.
Why did the government of India not suggest HAL? And the last question is, why you cancelled the work share agreement.
Dassault said it has nothing to with that. Dassault said ask the Indian government the question as to why the decision to do away with 126 aircraft was done with.
No, you are missing the point. The work share agreement of March 3, 2014.
Which was part of 126 aircraft proposed deal?
No, that has nothing to do with 126 deal. There is a separate agreement signed on March 3, 2014 between Dassault and HAL. There is nothing to do with the original agreement signed in 2012 for the 126 aircrafts. This is a separate agreement. If Dasaault had unilaterally cancelled the work share agreement, should not the government ask HAL to protest and say why you are cancelling it, what have I done wrong? None of these questions has been answered. The fact that none of these questions have been answered raises serious doubts and believe me there is traction; people are asking questions.
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