The EU countries often act contrary to its fundamental interests and succumb to pressure from third party
JEAN-SEBASTIEN EVRARD/AFP/Getty Images
Originally appeared at Politika, translated by A. Djurich exclusively for SouthFront
In early February 2015 in the world’s media appeared the unexpected news that India was preparing to terminate the contract, worth $ 10 billion, which was concluded in late 2012 with the French company “Dassault”, on the delivery of 126 “Rafale” fighters for the needs of the Indian Air Force. That year, the French fighter won a tender in which participated aircraft manufacturers from USA, Russia, Sweden and Britain. This was one of the largest and most profitable contracts that one of those companies could conclude, with one of the leading developing countries, and such contract for French manufacturer would provide a long-term production of airplanes and thus would secure them a more permanent presence in such an important market. However, in early April, during a visit by French President Hollande, India has officially announced that they will eventually buy only 36 “Rafale” aircraft, which drastically reduced what was lucrative contract, and he no longer seems quite safe.
During the negotiations between the Indian and the French side, the company “Dassault” almost doubled the price of one aircraft from 65 to 120 million dollars, so that the value of the entire contract had risen to 28-30 billion dollars, or nearly three times more than the original value. Then it became obvious that not only will the price be too high, but that it will not make any substantial change in the technological progress of the Indian air force. France side did not accept India’s request for the transfer of technology and changes in the technical layout of the aircraft, so they could use as much as possible the components of Indian production, and they refused to provide quality control for airplanes that will be assembled under license in India, especially since such a clause was always part of the agreement about military and technical cooperation which Russia has with India for decades. So they had to find an alternative solution that would involve either complete rejection of such an agreement or its radical reduction.
In the meantime, the news appeared that India is looking at new orders of Russian Su-30MKI fighters, perhaps 60-70 units, and the fact is that India was seriously considering the option of intensifying cooperation with Russia on a new fifth generation aircraft made on the platform of the newest Russian fighter jet T-50. It is the joint development of fifth generation aircraft that will constitute the backbone of the future Russian-Indian military and technical cooperation, regardless of the occurrence of some other competitors in the promising weapons market of India, where India will play a key technological role. In recent years, Russia has already lost several tenders for deliveries of military hardware to India (combat and transport helicopters, transport planes), so this kind of cooperation would represent a new leap in their relations. This is why the news in connection with “Rafale” made impact on the Russian side to intensify talks with Indian counterparts on further modernization of the Indian Air Force, offering numerous benefits for the purchase of new fighters.
All of this represents a sign that there are other ways to compensate for a smaller number of aircraft that India will get from the French, and it also represents a significant loss for the company “Dassault”, despite new sale contracts for 24 “Rafale” to Egypt and Qatar. Although it seems that France made a point in relation to Russia by making agreement with Egypt and Qatar, radically reduced delivery of aircraft for the Indian Air Force makes this only a Pyrrhic victory for the French defense industry. Orders from the French Air Force have already reduced and the prospects do not look quite good, China has long been under an arms embargo from the EU, which will not be abolished soon, and the possibilities of entering the Indian market is constantly decreasing. Options for the French defense industry are reducing, and there will be only more competitors in the global arms market.
Even if the incident with the “Mistral” (cancelation of contract whit Russia) had no significant impact on the aforementioned decision of the Indian government, the coincidence of timing with events in India can only cause concern. Unjustified political decisions and open political pressure where the EU countries often act contrary to its fundamental interests and succumb to pressure from third party, especially in the case of “Mistral”, resulted in opinion that buying weapons from European countries no longer seems like a safe and profitable business in developing countries. Empty space that Europe would leave in these markets would be filled quickly by other major players, notably the US, Russia and China. Therefore, the European elites should deeply reflect on these two examples. Let’s hope they will learn a lesson before it’s too late.
Author is Associate of the Institute for Recent History of Serbia, a doctor of Peking University and former visiting researcher at the University of Delhi