Defence Sector – DPP, Missions, Schemes, Security Forces, etc.

French fighter talks deadlocked

  1. Reason for the deadlock is enhanced costs and differences on offset requirements.
  2. The negotiations were stuck for three years as the cost shot up to over $20 billion from $10 billion.
  3. The Defence Ministry has made it clear that offsets apply to the deal which is 50% for the Medium Multi-Role Combat Aircraft (MMRCA)
  4. The Air Force has also sought some changes in the configuration which will further add to the cost and time overruns.
  5. As per the Defence Procurement Procedure, offset applies to all deals worth over Rs.300 crore under which companies have to invest 30 per cent of the value of the contract back in the country.
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