india

Updated: Dec 17, 2018 23:23 IST

The Comptroller and Auditor General (CAG) of India has finalised a draft report on the Rafale deal and sent it to the ministry of defence (MoD) asking for views on it, said a government official familiar with the development requesting anonymity.

The CAG is currently auditing around a dozen big ticket arms deals closed by the defence ministry in the past few years. “Among the dozen procurements under audit, draft reports of around half of the deals have been finalised and sent to MoD. The draft report for the Rafale deal was sent to the ministry almost two weeks back,” added this person.

Draft reports are sent to the ministry concerned as part of the standard operating procedure. After receiving their responses, CAG reviews them and prepares a final draft. Before the final report is sent to the House, it also holds a so-called exit conference with the ministry concerned.

“The exit conference with the regard to the Rafale deal and other defence deals may take place by the end of this month or early next year. Following which the CAG takes another couple of weeks to finalise the report. It hopes to be ready with its report by the end of Janaury or next year,” said the official.

The National Democratic Alliance’s (NDA) decision to enter a $8.7 billion government-to-government deal with France to buy 36 Rafale warplanes made by Dassault was announced in April 2015, with a deal signed a little over a year later. This replaced the previous United Progressive Alliance’s (UPA) decision to buy 126 Rafale aircraft, 108 of which were to be made in India by the state-owned Hindustan Aeronautics Ltd (HAL).

The deal has become controversial with the opposition, led by the Congress, claiming that the price at which India is buying the aircraft now is Rs 1,670 crore for each, three times the Rs 526 crore, the initial bid by the company when the UPA was trying to buy the aircraft. It claimed the previous deal included a technology transfer agreement with HAL.

The NDA has not disclosed pricing details, but the UPA deal, struck in 2012, was not a viable one, former defence minister Manohar Parrikar had previously said, implying that it would have never been closed. The UPA was not able to close it till 2014, largely over discussions related to pricing. The NDA has said the current deal also includes customized weaponry.

The deal has also become controversial as one of the offset deals signed by Dassault is with Anil Ambani’s Reliance Group. The Congress claims a new deal was signed to provide Ambani this opportunity. Both the government and Reliance have repeatedly denied this.

Sniffing an electoral opportunity in the deal, the Congress has been relentlessly keeping up the heat. Gandhi has claimed that it is “the corruption of the century”. The NDA has said that it cannot disclose the details of the price on two counts: a confidentiality agreement with France, and the strategic reason of not showing its hand to India’s enemies.

Last week, the Supreme Court said due process had been followed in the deal while dismissing petitions filed against it. It refused to order an investigation. But factual errors in the SC judgment has given fresh ammunition to the opposition to target the government again.

The government has already filed an application to correct one of the more significant errors. The court’s order refers to the CAG audit of the deal having been completed and a report submitted to the Public Accounts Committee (PAC).

The government’s application to the court states that its original submission on the deal to the court contained details of the usual process on defence acquisitions deal and mentioned that these are audited by CAG and presented before PAC and then parliament — something that the court took to mean that this deal had already been audited.