Rafale’s global hub

The controversial Rafale deal may go through another labyrinth of a new deal. Sources confirm that Dassault Aviation, the manufacturer of Rafale aircraft, recently submitted a reworked proposal to transfer the entire production facility of the planes to India. From 2024, after the French company has supplied the contracted 36 fighters, it aims to manufacture 114 similar planes at the cost of Euro 100 million each. According to the alleged offer, which was made by a Dassault team that visited the country, India can export these planes to other countries, and also become the global hub for components and spares. However, the offer by Dassault, which won the Euro 7.8 billion contract to supply 36 fighters to India in fly-away condition in 2016, apparently comes with a huge twist. The production will be transferred to Dassault Reliance Aerospace Ltd (DARL), which has its production facility at Mihan (Nagpur), Maharashtra. At present, the Anil Ambani-promoted Reliance Aerostructure owns 51%, and the remaining is held by the French company. But sources contend that Dassault wants a huge change in the ownership structure. It unofficially told the Indian government that the business empire of Anil Ambani had crumbled due to financial pressures and, hence, the bulk of the 51% owned by Reliance Aerostructure will need to be sold to a consortium of private companies. Anil Ambani can, if he insists, hang on to a small minority stake of 10-15%. According to sources, the French firm, which will continue to hold 49%, stated that the new deal and the manufacture in India depends on the changes in the equity holdings. No change, no deal. Now where will this leave Anil Ambani, whose wealth has dwindled from more than $40 billion to a few hundred million in a decade? Richer than before, one presumes!