India signals end of talks on larger French Rafale deal

India launches vast defence modernisation programme worth $100 billion, to keep up with Pakistan and China

NEW DELHI: India's future purchase of Rafale fighter jets will only come through direct talks with the French government, the defence minister has said, effectively killing talks on a massive deal.

Indian Prime Minister Narendra Modi announced last week that New Delhi had ordered 36 Rafale fighter jets from France in a multi-billion-dollar agreement that has been years in the making.

But Defence Minister Manohar Parrikar told reporters in New Delhi late on Monday that any future deals will be negotiated directly between the two governments.

"All deal(s) will be in G2G only," the Press Trust of India news agency quoted Parrikar as saying.

"The 36 are in fly-away condition which means they will be manufactured by the company in France and supplied in fly-away conditions."

The minister said commercial negotiations that have been dragging since 2012 to buy 126 Rafale jets from France's Dassault Aviation had gone into a "vortex" or a "loop", with no solution in sight.

But he stopped short of saying the government had scrapped talks altogether on the $12 billion defence deal billed as one of the world's biggest.

"Instead of going through the Request for Proposal route where there was lot of confusion and chaos, it was decided that we will go through the G2G route," he said.

Dassault won the right in January 2012 to enter exclusive negotiations with India to supply 126 Rafale fighters.

But the deal has been bogged down in torturous negotiations over cost and guarantee over assembly of the planes in India.

The original deal was for Dassault to supply 18 of the twin-engine fighters, while the remaining 108 would be made by state-run Hindustan Aeronautics Ltd under technology transfer agreements with India.

Modi announced the 36 jets had been ordered after talks with his counterpart Francois Hollande on a visit to France, the first leg of his maiden trip to Europe.

India has launched a vast defence modernisation programme worth some $100 billion, in part to keep up with rival neighbours Pakistan and China.