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aksha

Captain
nlca np2 assembly
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A Bar Brother

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Brumby said:
Do you have a link to the contents of the RFP as I see this point being brought up quite often? I would like to look into the terms that India laid out and the proposal in which Dassault's bid was accepted. Given that they are currently negotiating the terms to a final contract, presumably the RFP process was merely to select a party to enter into negotiation rather than an agreement. This would suggest either party is at liberty to walk away without penalty other then wasted effort and time.
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The RFP is not available.

Brumby said:
I think their end game was to acquire the technology besides the plane. I am still at a loss concerning HAL and Indian politics. I think Dassault was happy to go with another local partner. Given HAL's less than stellar track record with the Tejas, it would be financially suicidal to assume delivery risk without some clear cut escape clauses.
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Turns out it is not HAL but the MoD insisting on liability.

There are no equivalent local partners.
 
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paintgun said:
Basically Dassault promised everything and the moon to India, at the cost of $65mil per plane.

They now negotiated for $120 per plane, India asked for warranty of every planed manufactured at HAL as a bargaining counter and Dassault would not agree.
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That article was bogus.
 
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A Bar Brother

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Brumby said:
You made reference to a blogger that Dassault in using Reliance was trying to rip the IAF by double dipping. The blogger made a bunch of assertions on how that was going to happen but I really need you to explain how the double dipping actually works by using Reliance instead of HAL. I was trained professionally as a CPA and in my life time I have structured a lot of business transactions around the world and I have no clue what that blogger was talking about. Maybe you do and can explain it to me before I comment further.
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That blogger is the one who came up with the Rafale being $45 Billion and that Dassault has been insisting on doubling the costs. This double dipping is also from the same article. It is all bogus.

He's made up facts.
 
tphuang

tphuang

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so what is the main issue now that's preventing a deal from happening? Is it the part where MOD insisting on liability? Is it cost increase? Is it localization?
 
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A Bar Brother

Junior Member
tphuang said:
so what is the main issue now that's preventing a deal from happening? Is it the part where MOD insisting on liability? Is it cost increase? Is it localization?
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The cost story is made up. And localization negotiations are already over. To keep it short, the Contract Negotiations Committee has 4 sub-committees, that's cost, maintenance, offsets and ToT/industrial production.

Out of the 4 major groups, maintenance, offsets and ToT negotiations were completed months ago. What's pending right now is costs. And under costs, what's being negotiated for is the liability clause. Once an agreement is reached, the deal is done. MoD said costs negotiation was 75% done back in July.

Unlike most other manufacturers, Dassault does not want to be liable for HAL manufactured aircraft. They only want to be liable for the first 18 aircraft, but that doesn't make sense since most of the 126 will still require extensive support from Dassault. The first 60 will come in the form of kits. Even the last phase with 60 aircraft will need at least 10% support from Dassault, since they are expecting 90% indigenization of the Rafale.

An example.
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The Hawk MK-132 Advanced Jet Trainer (AJT) was inducted into the IAF in 2008 as a fighter trainer with the aim to replace the Kiran MK-II/MiG-21 route of training. Keeping in view the delay in delivery of Hawk by HAL due to receipt of defective components, jigs and fixtures from the foreign manufacturer on whom liquidated damages were levied, the original training plan by Hawk for 2010-2011 has been modified and pilots of the Indian Air Force (IAF) are being trained on the MiG-21 aircraft. Induction of aircraft for training in the Indian Air Force is a continuous process.

This information was given by Defence Minister Shri AK Antony in a written reply to Shri KJSP Reddy in Lok Sabha today.
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BAE provided defective tools for manufacturing the Hawks which led to delays, and BAE paid for it.

So Dassault is going to have to sign up for the liabilities since it says so in the DPP.
 
Brumby

Brumby

Major
A Bar Brother said:
Unlike most other manufacturers, Dassault does not want to be liable for HAL manufactured aircraft. They only want to be liable for the first 18 aircraft, but that doesn't make sense since most of the 126 will still require extensive support from Dassault. The first 60 will come in the form of kits. Even the last phase with 60 aircraft will need at least 10% support from Dassault, since they are expecting 90% indigenization of the Rafale.

An example.
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BAE provided defective tools for manufacturing the Hawks which led to delays, and BAE paid for it.

So Dassault is going to have to sign up for the liabilities since it says so in the DPP.
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We have already established in post #1754 that the RFP only attributes liability for direct cause for non compliance. I think your post is disingenuous in shifting (again) the narrative on liability where the discussion and evidence suggest otherwise. The Hawk example clearly supports the notion that liability is due and enforceable when direct cause is established i.e. for faulty materials as should be in any sensible commercial contractual obligations.

Please explain where is direct cause to Dassault if and when HAL fails to deliver on assembly. Dassault clearly signed up for primary cause as common sense dictates but not on secondary as with HAL's position.

Brumby said:
I concur that reading of the different clauses only attribute liability to Dassault if any delay is a result of their direct non performance. As I understand the issue currently and the source of the gridlock is that HAL is insisting that Dassault is held responsible for HAL's non performance and which is contrary to original terms. Specifically this is the quote "HAL is insisting that Dassault guarantee the delivery schedule because hundreds of spares and subsystems will be supplied by the French.". A delivery schedule is a result of completion of assembly of parts (supplied by Dassault) but assembled by HAL. If HAL fails to assemble on time, why is Dassault made responsible for HAL's non performance and contrary to original terms as you and I concluded?
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