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Rafale Agreement Sushen Gupta submits classified documents to Indian negotiating team at Dassault: French report

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‘Middleman even got the Excel sheet created by the Indian team to calculate the purchase price’

Arms dealer Sushen Gupta, the indictment filed by the Enforcement Directorate (ED) in the AgustaWestland deal, provided classified documents for Dassault Aviation to the Indian negotiating team when talks stalled on standard pricing in the 7.87 bn Rafale deal, according to French media outlet Mediapart.

According to information received from Mediapart, one of those other defense agreements in the ED investigation that was not identified in the indictment, is the Intergovernmental Agreement (IGA) signed in 2016 for 36 Rafale aircraft. In the official indictment dated May 20, 2019 against Mr. Gupta, ED wrote that he had obtained sensitive data which should have been in the possession of the Ministry of Defense. He also said that since returns from other defense agreements are not the subject of the current investigation into the AgustaWestland scandal, according to the report separate investigations will be undertaken in relation to other agreements.

The report said that according to information received from Mediapart, one of those other defense agreements in the ED investigation, which was not identified in the indictment, is the Intergovernmental Agreement (IGA) signed in 2016 for 36 Rafale aircraft.

In the official indictment dated May 20, 2019 against Sushen Gupta, ED wrote that since returns from other defense agreements are not the subject of an ongoing investigation into the AgustaWestland scandal, separate investigations will be undertaken into other agreements, said the report.

Referring to the CAG audit of the agreement which found that the final cost of Rafale aircraft was 17% less than the initial MMRCA tender offer and the High Court decision in 2019 that there was not sufficient reason to open an investigation into the matter, the report said, But that decision was taken without the information gathered in the AgustaWestland investigation by the Enforcement Directorate.

In April 2015, Prime Minister Narendra Modi announced the direct purchase of 36 Rafale aircraft, citing the critical operational need of the Indian Air Force during a visit to France. In negotiating the deal, the Indian side demanded, as promised by France, that the cost of Rafale aircraft be the lowest ever offered by Dassault and submitted the Eurofighter offer in 2014 for a 20% discount on the Typhoon aircraft which lost in the MMRCA tender .

Following the standard calculations, the Indian negotiators concluded, in a confidential report dated August 2015, that the total purchase price for the aircraft, including their weapons, should be ALL 5.06 billion, the report said, while in January 2016, Dassault proposed more than double the price, $ 10.7 billion excluding missile equipment.

Talks were blocked on this according to the report and Mr Gupta received documents including minutes of meetings from the Indian Negotiating Team (INT), arguments they had prepared to present to the French and detailed notes on cost calculations and methodology used. Mr Gupta even took an Excel sheet created by an INT member to calculate the purchase price, the report said. The Indian authorities had finally accepted the French offer at a total cost of 7.87 billion lek, an amount they had rejected six months earlier.

The report also referred to a number of investigative reports by Hindu which showed how anti-corruption clauses were removed from the agreement and also the INT was bypassed and the Office of the Prime Minister directly negotiated the agreement.

In March 2017, one of the Indian companies of the Gupta Families, Defsys Solutions, billed Dassault for 1 million euros for the production of 50 models of Rafale aircraft replicas as stated in the first part of the three parts of the Mediapart series.

Defsys Solutions was also made, as announced in a statement issued by Dassault, one of the subcontractors of the Rafale deal, the report said adding, Dassault declined to disclose to Mediapart the nature or cost of that contract. In addition, the documents also show that Dassault and his French industrial partner Thales paid Mr. Gupta several million euros secret commissions for offshore accounts and shell companies, using inflated invoices for software consulting. Mr Gupta, who was contacted by email, and contacted again on several occasions, did not respond to Mediaparts’ request for an interview, the report said.

Responding to reports, a Dassault Aviation spokesman said in a statement that numerous checks were carried out by official organizations, including the French Anti-Corruption Agency, and no violations were reported, particularly under the contract with India for the purchase of 36 Rafales.

Stating that the contract with India for 36 Rafales was created on the basis of government to government, the statement said, This contract, as well as the respective compensation contract, meet the criteria set by these regulations and are being executed in full transparency between different government partners and industrial.

In the compensation contract with Reliance Group, she said a joint venture was set up in 2017 and built a plant in Nagpur that has been producing multiple Falcon parts since 2018. Dassault Aviation and its partners are working with 60 companies in India and negotiations are underway to establish possible new collaborations, the statement added.

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