India signed a deal to buy 36 Rafale fighter jets from France on Friday (September 23) for around $8.7 billion (£6.7bn), the country’s first major acquisition of combat planes in two decades and a boost for prime minister Narendra Modi’s plan to rebuild an ageing fleet.
French defence minister Jean-Yves Le Drian signed the agreement with his Indian counterpart, Manohar Parrikar, in New Delhi, ending almost 18 months of wrangling over terms between New Delhi and manufacturer Dassault Aviation.
“You can only ever be completely sure once (the deal) has been signed and that’s what happened today,” said Le Drian after the ceremony, referring to the delays.
India’s defence ministry said it would confirm the exact price later on Friday, but a ministry official said it was €7.8bn (£6.7bn).
The air force is down to 33 squadrons, against its requirement of 45 to face both China, with which it has a festering border dispute, and nuclear-armed rival Pakistan.
China’s increasing assertiveness as well as its simmering rivalry with Pakistan have increased India’s need to upgrade its military.
Air force officials have warned for years about a major capability gap opening up with China and Pakistan without new state-of-the-art planes. India’s outdated and largely Russian-made fleet is retiring and production of a locally made plane was delayed.
Defence experts say it will bring a much-needed boost to India’s air force as it tries to renew its dwindling fleet of Russian MiG-21s – dubbed “Flying Coffins” because of their poor safety record.
India had originally awarded Dassault with an order for 126 Rafales in 2012 after the twin-engine fourth-generation fighter beat rivals in a decade-long selection process, but subsequent talks collapsed.
Modi, who has vowed to modernise India’s armed forces with a $150bn (£115bn) spending spree, personally intervened in April 2015 to agree on the smaller order of 36 and give the air force a near-term boost as he weighed options for a more fundamental overhaul.
But it continued to be held back by disagreements such as India’s insistence that arms makers invest a percentage of the value of any major deal in India, known as the offset clause.
French president Hollande again pushed the deal on a visit to India in January, when he was Modi’s guest for Republic Day celebrations, but officials privately acknowledged that price had become a sticking point.
The first ready-to-fly Rafales are expected to arrive by 2019 and India is set to have all 36 within six years.
It is the biggest order for the Dassault fighter jets after Egypt agreed to buy 24 of the aircraft in 2015 and Qatar purchased the same amount later that year.
The highly versatile Rafale is currently being used for bombing missions over Syria and Iraq as part of an international campaign against the Daesh (Islamic State) jihadist group.
It has also been deployed in the past for air strikes in Libya and Afghanistan.