TSAMTO, December 22. The Indian government has imposed a fine on the French company Dassault Aviation for delaying the fulfillment of obligations under compensation deals related to the 2016 contract for the supply of 36 Rafale fighters.
As Defense News reminds, in September 2016, the governments of France and India signed a contract worth $7.8 billion. euro ($8.8 billion). Under the terms of the agreement, 50% of the value of the contract was supposed to be compensated by counter-contracts and deliveries to be performed by Dassault Aviation and its partners, Safran and Thales, for seven years.
To make offsets, three firms have teamed up with more than 70 Indian companies and the Defense Research and Development Organization of the Ministry of Defense of India (DRDO). DRDO has requested from French companies several technologies related to stealth, radar stations, aircraft engines, materials for electronics.
A representative of the Ministry of Defense of India on condition of anonymity told Defense News that the fine will be paid from a bank guarantee in the amount of 185 million euros provided by Dassault Aviation as a guarantee for violation of contractual obligations.
The official did not name the amount of fines imposed on Dassault Aviation, as well as details of problems impeding the implementation of compensation programs. Dassault Aviation declined to comment on this issue.
In accordance with the policy of the Ministry of Defense of India, original equipment manufacturers (OEMs) can fulfill a compensation package by purchasing relevant goods or services from Indian suppliers, make foreign direct investments in the Indian defense industry or transfer modern technologies.
French Armed Forces Minister Florence Parly and Indian Defense Minister Rajnath Singh discussed ways to expand bilateral cooperation in the field of defense at a meeting on December 17, 2021. Within the framework of the third annual dialogue, representatives of the Indian Defense Ministry noted that several French defense companies do not cooperate in the transfer of DRDO technologies, referring to the inconsistency of the production base of Indian companies with the necessary requirements.
