France opens judicial probe into fighter deal with India, new revelations emerge

Rafale Papers': France opens judicial probe into fighter deal with India, new revelations emerge

JULY 2, 2021 BY YANN PHILIPPIN

A judicial probe into suspected corruption has been opened in France over the 7.8-billion-euro sale to India in 2016 of 36 Dassault-built Rafale fighter aircraft. In this trendy of a series of investigations about the secret dealings in the back of the contract, Mediapart reveals how Dassault furnished a remarkably generous monetary gift to its neighborhood industrial partner Reliance Group, owned via Anil Ambani, a close pal of Indian Prime Minister Narendra Modi

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'Rafale Papers': France opens judicial probe into fighter deal with India, new revelations emerge

JULY 2, 2021 BY YANN PHILIPPIN

A judicial probe into suspected corruption has been opened in France over the 7.8-billion-euro sale to India in 2016 of 36 Dassault-built Rafale fighter aircraft. In this latest of a collection of investigations about the secret dealings behind the contract, Mediapart exhibits how Dassault provided a remarkably beneficiant financial present to its local industrial companion Reliance Group, owned by Anil Ambani, a shut friend of Indian Prime Minister Narendra Modi.

AFrench decide has been appointed to lead a judicial investigation into suspected “corruption” and “favouritism” over the 7.8-billion-euro sale to India of 36 Dassault Aviation Rafale fighter aircraft, Mediapart can reveal. The highly touchy probe into the inter-governmental deal signed off in in 2016 was formally opened on June 14th.

It was once following Mediapart’s “Rafale Papers” series of investigations into the secret dealings at the back of the contract, published in April, that French anti-corruption NGO Sherpa filed a grievance with the tribunal of Paris, citing “corruption”, “influence peddling”, “money laundering”, “favouritism” and undue tax wavering surrounding the deal.

'Rafale Papers’: the explosive documents in France-India jets deal

BY YANN PHILIPPIN

Rafale jets sale to India: Macron, Hollande and the blind eye of France's anti-corruption services

BY YANN PHILIPPIN

The monetary crimes branch of the French public prosecution services, the PNF, demonstrated to Mediapart on Friday that the newly opened investigation is focussed on all four of the alleged crimes.

As Mediapart has in the past reported, in 2019 the former head of the PNF, Eliane Houlette, dismissed an preliminary complaint filed by way of Sherpa, against the recommendation of one of her staff and besides carrying out any investigations, justifying her decision as “to keep the interests of France”.

Now, two years later, her successor as head of the PNF, Jean-François Bohnert, has determined to support the opening of a probe, after the grievance was up to date with details from Mediapart’s current series of investigations.

The crook investigation, opened on June 14th and led by an impartial magistrate, an investigating judge, will, among different elements, examine questions surrounding the moves of former French president François Hollande, who was in workplace when the Rafale deal was inked, and contemporary French president Emmanuel Macron, who was at the time Holllande’s financial system and finance minister, as well as the then defence minister, now overseas affairs minister, Jean-Yves Le Drian.

In a statement to Mediapart, Sherpa’s attorneys William Bourdon (founder of the NGO) and Vincent Brengarth said the launch of the probe “will always favour the emergence of the truth and the identification of these responsible in what increasingly more resembles a state scandal”.

In a declaration published in April, reacting to Mediapart’s investigation, Dassault Aviation noted that the group “acts in strict compliance with the OECD Anti-Bribery Convention and country wide laws”.

“Numerous controls are carried out by reliable organizations, including the French Anti-Corruption Agency. No violations had been reported, notably in the body of the contract with India for the acquisition of 36 Rafales”, Dassault added.

The probe will notably focal point on the role of rich Indian businessman Anil Ambani. The Chairman and owner of Indian conglomerate Reliance Group, who is in my opinion close to Indian Prime Minister Narendra Modi, Ambani is at the coronary heart of the suspicions of corruption surrounding the Rafale deal, which was concluded with the aid of Hollande and Modi in an inter-governmental agreement in 2016.

Sale of French Rafale jet combatants to India: how a state scandal used to be buried

BY YANN PHILIPPIN

François Hollande, his partner’s film, and the French fighter jet sale to India

BY KARL LASKE AND ANTTON ROUGET

In this report, Mediapart can reveal the important points of a partnership contract signed between Rafale manufacturer Dassault Aviation and Reliance, which in 2017 created a joint assignment company known as Dassault Reliance Aerospace Limited (DRAL), with the building of an industrial plant shut to the central Indian city of Nagpur.

The personal documents acquired by Mediapart divulge how Dassault had in fact no activity in forming a partnership with Reliance other than for political reasons.

It emerges from the archives that Dassault provided Reliance with remarkably beneficiant financial phrases for the establishment of their joint venture. Ordinarily, the companions in a jointly owned subsidiary would supply equal funds for its capital. But that was once not the case with DRAL.

The two companions agreed a maximum funding in the subsidiary of 169 million euros. Of that sum, Dassault, which held a 49% stake in DRAL, pledged to provide up to 159 million euros, representing 94% of the total, whilst Reliance would provide simply the remaining 10 million euros.

This intended that Reliance was given the majority 51% stake in the joint challenge in return for a relatively very modest sum.

While Reliance delivered neither funds nor understanding of any significance to the joint venture, it did convey to it its capacity for political influence. In an extract from one of the files obtained through Mediapart detailing the agreements between Reliance and Dassault, Anil Ambani’s group used to be handed the mission of “marketing for packages and services with the GOI” – the acronym for “government of India”.

Contacted via Mediapart, Dassault Aviation declined to comment. Also contacted, the Reliance Group failed to respond to Mediapart’s questions.

Amid recurrent media revelations in India, the controversy over how the fighter jet sale used to be concluded has for more than three years consistently dogged Indian Prime Minister Narendra Modi, leader of the ultra-nationalist Bharatiya Janata Party (BJP), and brought about outrage among his opponents. Modi is accused of imposing into the contract, signed between France and India, Ambani’s non-public group as Dassault’s foremost local industrial partner, to the detriment of India’s large state-owned aviation manufacturer Hindustan Aeronautics Limited (HAL).

In a preceding interview with Mediapart, François Hollande confirmed that the choice to appoint Reliance as Dassault’s industrial partner used to be made by the Indian government, and that France “didn’t have the choice” in the matter. The Indian government, Reliance and Dassault all denied that model of events.

At the time of the deal, the Reliance Group, which had no experience in aeronautic manufacturing, used to be gripped by monetary difficulties. Despite this, Anil Ambani succeeded in entering the big defence contract, and in the process each the Indian prime minister and two successive French presidents have come underneath suspicion over their roles in the deal.

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3 JUL 2021 ÉDITION DU SOIR

LE JOURNAL LE STUDIO LE CLUB

INTERNATIONAL INVESTIGATION

'Rafale Papers': France opens judicial probe into fighter deal with India, new revelations emerge

JULY 2, 2021 BY YANN PHILIPPIN

It used to be following Mediapart’s “Rafale Papers” series of investigations into the secret dealings in the back of the contract, published in April, that French anti-corruption NGO Sherpa filed a criticism with the tribunal of Paris, citing “corruption”, “influence peddling”, “money laundering”, “favouritism” and undue tax wavering surrounding the deal.

'Rafale Papers’: the explosive documents in France-India jets deal

BY YANN PHILIPPIN

Rafale jets sale to India: Macron, Hollande and the blind eye of France's anti-corruption services

BY YANN PHILIPPIN

The monetary crimes branch of the French public prosecution services, the PNF, tested to Mediapart on Friday that the newly opened investigation is focussed on all four of the alleged crimes.

As Mediapart has earlier reported, in 2019 the former head of the PNF, Eliane Houlette, dismissed an preliminary complaint filed via Sherpa, against the recommendation of one of her staff and besides carrying out any investigations, justifying her decision as “to hold the interests of France”.

Now, two years later, her successor as head of the PNF, Jean-François Bohnert, has determined to support the opening of a probe, after the criticism was up to date with details from Mediapart’s latest series of investigations.

French armed forces minister Florence Parly with Reliance Group proprietor and chairman Anil Ambani (centre) and Éric Trappier (left), during the inauguration of the joint project plant in Nagpur, October 27th 2017. © Money Sharma / AFP

French armed forces minister Florence Parly with Reliance Group proprietor and chairman Anil Ambani (centre) and Éric Trappier (left), during the inauguration of the joint assignment plant in Nagpur, October 27th 2017. © Money Sharma / AFP

The crook investigation, opened on June 14th and led by an unbiased magistrate, an investigating judge, will, among different elements, examine questions surrounding the movements of former French president François Hollande, who was in workplace when the Rafale deal was inked, and contemporary French president Emmanuel Macron, who was at the time Holllande’s economic system and finance minister, as well as the then defence minister, now overseas affairs minister, Jean-Yves Le Drian.

In a announcement published in April, reacting to Mediapart’s investigation, Dassault Aviation cited that the group “acts in strict compliance with the OECD Anti-Bribery Convention and countrywide laws”.

“Numerous controls are carried out by respectable organizations, including the French Anti-Corruption Agency. No violations have been reported, notably in the body of the contract with India for the acquisition of 36 Rafales”, Dassault added.

The probe will notably focal point on the role of rich Indian businessman Anil Ambani. The Chairman and owner of Indian conglomerate Reliance Group, who is in my opinion close to Indian Prime Minister Narendra Modi, Ambani is at the coronary heart of the suspicions of corruption surrounding the Rafale deal, which was concluded by way of Hollande and Modi in an inter-governmental agreement in 2016.

Sale of French Rafale jet combatants to India: how a state scandal used to be buried

BY YANN PHILIPPIN

François Hollande, his partner’s film, and the French fighter jet sale to India

BY KARL LASKE AND ANTTON ROUGET

In this report, Mediapart can reveal the important points of a partnership contract signed between Rafale manufacturer Dassault Aviation and Reliance, which in 2017 created a joint challenge company referred to as Dassault Reliance Aerospace Limited (DRAL), with the building of an industrial plant shut to the central Indian city of Nagpur.

The exclusive documents acquired by Mediapart expose how Dassault had in fact no pastime in forming a partnership with Reliance other than for political reasons.

It emerges from the files that Dassault provided Reliance with remarkably beneficiant financial phrases for the establishment of their joint venture. Ordinarily, the companions in a jointly owned subsidiary would grant equal funds for its capital. But that was once not the case with DRAL.

This intended that Reliance was given the majority 51% stake in the joint task in return for a relatively very modest sum.

While Reliance introduced neither funds nor knowledge of any significance to the joint venture, it did deliver to it its capacity for political influence. In an extract from one of the archives obtained through Mediapart detailing the agreements between Reliance and Dassault, Anil Ambani’s group used to be handed the mission of “marketing for applications and services with the GOI” – the acronym for “government of India”.

Contacted by means of Mediapart, Dassault Aviation declined to comment. Also contacted, the Reliance Group failed to respond to Mediapart’s questions.

Amid recurrent media revelations in India, the controversy over how the fighter jet sale was once concluded has for more than three years constantly dogged Indian Prime Minister Narendra Modi, leader of the ultra-nationalist Bharatiya Janata Party (BJP), and induced outrage among his opponents. Modi is accused of imposing into the contract, signed between France and India, Ambani’s personal group as Dassault’s predominant local industrial partner, to the detriment of India’s large state-owned aviation manufacturer Hindustan Aeronautics Limited (HAL).

In a preceding interview with Mediapart, François Hollande confirmed that the choice to appoint Reliance as Dassault’s industrial partner was once made by the Indian government, and that France “didn’t have the choice” in the matter. The Indian government, Reliance and Dassault all denied that model of events.

At the time of the deal, the Reliance Group, which had no experience in aeronautic manufacturing, was once gripped by monetary difficulties. Despite this, Anil Ambani succeeded in entering the big defence contract, and in the process each the Indian prime minister and two successive French presidents have come below suspicion over their roles in the deal.

Mocking demonstrators in the Indian city of Mumbai in 2018 carrying masks of Indian Prime Minister Narendra Modi (right) and Reliance Group chairman and owner Anil Ambani standing in the front of a replica mannequin of a Rafale fighter jet. © Indranil Mukerjee / AFP

In January 2016, just months earlier than the signature of the inter-governmental contract for the sale of the 36 Dassault Rafale jets, an arm of the Reliance Group provided 1.6 million euros of funding for a characteristic film co-produced via then French president François Hollande’s personal partner, the actress Julie Gayet.

Meanwhile, in accordance to a report with the aid of French daily Le Monde, cutting-edge French president Emmanuel Macron, who was at the time Hollande’s financial system and finance minister, was allegedly concerned in a surprising selection to waver a tax adjustment claim of 143 million euros towards a French subsidiary of the Reliance Group.

By allying itself with Dassault, Reliance gained a giant part of the four billion euros-worth of contracts Dassault was required by way of the terms of the Rafale deal to supply to Indian companies, in what is called an “offset” agreement, supposed to benefit the neighborhood economy.

It was in 2012 when, following the issuing of a public tender, Dassault Aviation was once chosen to supply the Indian Air Force with 126 Rafale jets. Under the phrases of the contract, the state-owned company Hindustan Aeronautics Limited (HAL) used to be appointed as Dassault’s principal industrial partner, and it was once to assemble 108 of the fighter jets in India.

Negotiations to hammer out the high-quality detail of the definitive contract persevered for several years earlier than a sudden turnaround used to be announced on April tenth 2015. That was when Indian Prime Minister Narendra Modi, who had been elected to workplace the previous year, introduced during a go to to Paris that he wanted to overturn the phrases of the original tender, and as an alternative purchase simply 36 Rafale jets, all of which would be manufactured in France.

Dassault document provides to corruption claims over Rafale sale to India

BY KARL LASKE AND ANTTON ROUGET

The surprise announcement had been saved secret, to the point the place the Indian foreign affairs ministry had referred simply two days earlier to persevering with contract discussions with HAL.

But the documents viewed by Mediapart exhibit that Dassault and Reliance had in fact signed their first Memorandum of Understanding (MoU) – a report setting out large outlines of an agreement – on March twenty sixth 2015. That was 15 days earlier than Modi’s announcement of the turnaround, and the exclusion of HAL, and begs the question as to whether or not the two companies had been knowledgeable of it in advance.

The events had been all the more shocking in that the negotiations between Dassault and HAL had apparently through then ironed out any differences between the two companies, as used to be announced by means of Dassault Aviation CEO Éric Trappier, in the presence of both the head of the Indian Air Force and the chairman of HAL, in a speech on March twenty fifth 2015 at the biennial Aero India airshow in Bengaluru (the former Bangalore).

In a video recording (see below) released through the Indian National Congress party, which represents the principal political opposition to the Modi government, Trappier declared: “You can think about my great pride to hear […] from HAL chairman that we are in agreement for the obligations sharing, considering as nicely our conformity with the RFP [Request for Proposal] in order to be in line with the rules of this competition. I strongly consider that contract finalisation and signature would come very soon.”

Yet the very next day, in accordance to documents now bought by Mediapart, Dassault signed the MoU with Reliance, which used to be soon observed by Modi’s overturning of the unique tender settlement and, with it, the obligation for Dassault to accomplice with HAL.

The MoU prudently allowed for a “possible joint venture”. It would include “program and task management”, “research and development”, “design and engineering”, “assembly and manufacture”, “maintenance” et “training”. But it avoided express mention of the duties allotted for HAL in the tender.

With Modi’s turnaround, the avenue was now clear for a new alliance, and in November 2015, Dassault CEO Trappier and Reliance Group chairman Anil Ambani signed a “strategic partnership agreement”, a extra detailed file than the previous MoU, for the institution of a joint venture in India.

That settlement set out a project via the two companies whereby, in the case of “subsequent sales” to India which would consist of local manufacturing activity, it would be the joint project company that would be in cost of the “aircraft final meeting line”, to the exclusion of HAL (see document below).

An extract from the “strategic partnership agreement” signed on November ninth 2015 between Dassault Aviation CEO Éric Trappier and Reliance group chairman Anil Ambani. © Document Mediapart

More troubling nonetheless was the graph for Dassault and Reliance to take part in fighter jet improvement for which HAL was in charge. Dassault and Reliance deliberate to provide “design consultancy” for a future model of the Tejas single-engined Indian “Light Combat Aircraft” (LCA) manufactured by HAL, which had been designed collectively with the Indian defence ministry’s Aeronautical Development Agency.

The “partnership agreement” also validated that Dassault had hardly any industrial hobby in allying itself with Reliance. It detailed how Dassault used to be to provide nearly every vital activity in the joint venture, which includes its “technology and know-how”, its “technical assistance”, and its “international marketing” capabilities.

On its side, Reliance was to supply “production facilities”. Given that the group had at that time no aeronautical manufacturing plants, this was once probably with an eye to the implantation of the future joint-venture DRAL manufacturing unit near the town of Nagpur.

Importantly, the second mission given to Reliance was once the explicit assignment of “marketing for programs and offerings with the GOI [Government of India] and other authorities (such as nearby states) in compliance with applicable laws”. In sum, it was once to use its powers of influence (see record below).

An extract from the “strategic partnership agreement” signed on November 9th 2015 between Dassault Aviation CEO Éric Trappier and Reliance team chairman Anil Ambani. © Document Mediapart

The inter-governmental agreement finalising the sale of the 36 Rafale used to be signed in September 2016. Two month later, on November 28th 2016, Dassault and Reliance signed a “shareholders’ agreement” which set out their relationship in the future joint mission company. But the financial important points of this were so touchy that they did not discern in the contract, and instead had been contained in a confidential “side letter” which used to be signed that same day.

It is that “side letter” that contained the money gifted to Reliance through Dassault.

As almost equal partners, the two groups each pledged to furnish up to 10 million euros for the capital of the joint venture. Up to that point, everything observed business logic. But Dassault additionally promised a “share premium”, a supplementary sum on the price of the shares, of a most 43 million euros, plus loans specified as “not exceeding 106 million euros”.

This meant that Dassault had pledged to furnish up to 159 million euros out of the total funding of 169 million euros, representing 94% of that total. Meanwhile, the contribution by Reliance, it used to be noted, “shall not exceed 10 million euros, all in equity”.

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'Rafale Papers': France opens judicial probe into fighter deal with India, new revelations emerge

JULY 2, 2021 BY YANN PHILIPPIN

A judicial probe into suspected corruption has been opened in France over the 7.8-billion-euro sale to India in 2016 of 36 Dassault-built Rafale fighter aircraft. In this modern-day of a series of investigations about the secret dealings at the back of the contract, Mediapart reveals how Dassault supplied a remarkably generous economic gift to its neighborhood industrial partner Reliance Group, owned by using Anil Ambani, a close pal of Indian Prime Minister Narendra Modi.

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AFrench judge has been appointed to lead a judicial investigation into suspected “corruption” and “favouritism” over the 7.8-billion-euro sale to India of 36 Dassault Aviation Rafale fighter aircraft, Mediapart can reveal. The enormously sensitive probe into the inter-governmental deal signed off in in 2016 used to be formally opened on June 14th.

It was following Mediapart’s “Rafale Papers” collection of investigations into the secret dealings behind the contract, posted in April, that French anti-corruption NGO Sherpa filed a complaint with the tribunal of Paris, citing “corruption”, “influence peddling”, “money laundering”, “favouritism” and undue tax wavering surrounding the deal.

'Rafale Papers’: the explosive archives in France-India jets deal

BY YANN PHILIPPIN

Rafale jets sale to India: Macron, Hollande and the blind eye of France's anti-corruption services

BY YANN PHILIPPIN

The financial crimes department of the French public prosecution services, the PNF, confirmed to Mediapart on Friday that the newly opened investigation is focussed on all 4 of the alleged crimes.

As Mediapart has previously reported, in 2019 the former head of the PNF, Eliane Houlette, pushed aside an initial grievance filed by Sherpa, towards the advice of one of her workforce and without carrying out any investigations, justifying her selection as “to preserve the pursuits of France”.

Now, two years later, her successor as head of the PNF, Jean-François Bohnert, has decided to aid the opening of a probe, after the complaint was once updated with small print from Mediapart’s recent sequence of investigations.

French armed forces minister Florence Parly with Reliance Group owner and chairman Anil Ambani (centre) and Éric Trappier (left), in the course of the inauguration of the joint venture plant in Nagpur, October twenty seventh 2017. © Money Sharma / AFP

French armed forces minister Florence Parly with Reliance Group owner and chairman Anil Ambani (centre) and Éric Trappier (left), at some stage in the inauguration of the joint venture plant in Nagpur, October twenty seventh 2017. © Money Sharma / AFP

The criminal investigation, opened on June 14th and led by using an independent magistrate, an investigating judge, will, amongst other elements, look at questions surrounding the actions of former French president François Hollande, who used to be in office when the Rafale deal used to be inked, and current French president Emmanuel Macron, who was once at the time Holllande’s economy and finance minister, as nicely as the then defence minister, now foreign affairs minister, Jean-Yves Le Drian.

In a assertion to Mediapart, Sherpa’s lawyers William Bourdon (founder of the NGO) and Vincent Brengarth stated the launch of the probe “will necessarily favour the emergence of the fact and the identification of those accountable in what increasingly resembles a kingdom scandal”.

In a statement posted in April, reacting to Mediapart’s investigation, Dassault Aviation stated that the crew “acts in strict compliance with the OECD Anti-Bribery Convention and national laws”.

“Numerous controls are carried out by using official organizations, along with the French Anti-Corruption Agency. No violations were reported, highly in the frame of the contract with India for the acquisition of 36 Rafales”, Dassault added.

The probe will fantastically focus on the function of wealthy Indian businessman Anil Ambani. The Chairman and proprietor of Indian conglomerate Reliance Group, who is personally shut to Indian Prime Minister Narendra Modi, Ambani is at the heart of the suspicions of corruption surrounding the Rafale deal, which was once concluded by Hollande and Modi in an inter-governmental settlement in 2016.

Sale of French Rafale jet fighters to India: how a nation scandal was buried

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François Hollande, his partner’s film, and the French fighter jet sale to India

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In this report, Mediapart can expose the details of a partnership contract signed between Rafale producer Dassault Aviation and Reliance, which in 2017 created a joint venture organization called Dassault Reliance Aerospace Limited (DRAL), with the constructing of an industrial plant close to the central Indian town of Nagpur.

The confidential files obtained by means of Mediapart reveal how Dassault had in reality no interest in forming a partnership with Reliance different than for political reasons.

It emerges from the documents that Dassault supplied Reliance with remarkably generous monetary terms for the institution of their joint venture. Ordinarily, the partners in a together owned subsidiary would provide equal dollars for its capital. But that was now not the case with DRAL.

The two partners agreed a most investment in the subsidiary of 169 million euros. Of that sum, Dassault, which held a 49% stake in DRAL, pledged to supply up to 159 million euros, representing 94% of the total, while Reliance would furnish just the final 10 million euros.

This meant that Reliance used to be given the majority 51% stake in the joint venture in return for a incredibly very modest sum.

While Reliance brought neither cash nor know-how of any value to the joint venture, it did bring to it its ability for political influence. In an extract from one of the documents acquired by Mediapart detailing the agreements between Reliance and Dassault, Anil Ambani’s team was passed the mission of “marketing for programs and offerings with the GOI” – the acronym for “government of India”.

Contacted by Mediapart, Dassault Aviation declined to comment. Also contacted, the Reliance Group failed to reply to Mediapart’s questions.

Amid recurrent media revelations in India, the controversy over how the fighter jet sale was concluded has for extra than three years persistently dogged Indian Prime Minister Narendra Modi, chief of the ultra-nationalist Bharatiya Janata Party (BJP), and caused outrage amongst his opponents. Modi is accused of imposing into the contract, signed between France and India, Ambani’s private crew as Dassault’s principal neighborhood industrial partner, to the detriment of India’s giant state-owned aviation producer Hindustan Aeronautics Limited (HAL).

In a previous interview with Mediapart, François Hollande tested that the decision to appoint Reliance as Dassault’s industrial associate was made by way of the Indian government, and that France “didn’t have the choice” in the matter. The Indian government, Reliance and Dassault all denied that version of events.

At the time of the deal, the Reliance Group, which had no journey in aeronautic manufacturing, was gripped via financial difficulties. Despite this, Anil Ambani succeeded in coming into the huge defence contract, and in the system both the Indian high minister and two successive French presidents have come under suspicion over their roles in the deal.

Mocking demonstrators in the Indian town of Mumbai in 2018 wearing masks of Indian Prime Minister Narendra Modi (right) and Reliance Group chairman and proprietor Anil Ambani standing in front of a reproduction model of a Rafale fighter jet. © Indranil Mukerjee / AFP

Mocking demonstrators in the Indian town of Mumbai in 2018 wearing masks of Indian Prime Minister Narendra Modi (right) and Reliance Group chairman and proprietor Anil Ambani standing in front of a duplicate model of a Rafale fighter jet. © Indranil Mukerjee / AFP

In January 2016, simply months before the signature of the inter-governmental contract for the sale of the 36 Dassault Rafale jets, an arm of the Reliance Group furnished 1.6 million euros of funding for a feature movie co-produced by then French president François Hollande’s non-public partner, the actress Julie Gayet.

Meanwhile, according to a document by French each day Le Monde, current French president Emmanuel Macron, who was once at the time Hollande’s economy and finance minister, used to be allegedly involved in a stunning decision to waver a tax adjustment declare of 143 million euros against a French subsidiary of the Reliance Group.

By allying itself with Dassault, Reliance won a large section of the 4 billion euros-worth of contracts Dassault was once required by the phrases of the Rafale deal to give to Indian companies, in what is known as an “offset” agreement, intended to advantage the local economy.

It used to be in 2012 when, following the issuing of a public tender, Dassault Aviation was chosen to furnish the Indian Air Force with 126 Rafale jets. Under the terms of the contract, the state-owned employer Hindustan Aeronautics Limited (HAL) was appointed as Dassault’s major industrial partner, and it was to collect 108 of the fighter jets in India.

Negotiations to hammer out the fine element of the definitive contract continued for numerous years before a unexpected turnaround was introduced on April 10th 2015. That was once when Indian Prime Minister Narendra Modi, who had been elected to office the preceding year, announced for the duration of a visit to Paris that he desired to overturn the terms of the authentic tender, and instead buy just 36 Rafale jets, all of which would be manufactured in France.

Dassault file adds to corruption claims over Rafale sale to India

BY KARL LASKE AND ANTTON ROUGET

The shock announcement had been kept secret, to the factor where the Indian overseas affairs ministry had referred just two days previously to continuing contract discussions with HAL.

But the files seen by means of Mediapart show that Dassault and Reliance had in reality signed their first Memorandum of Understanding (MoU) – a document putting out broad outlines of an settlement – on March 26th 2015. That was once 15 days before Modi’s announcement of the turnaround, and the exclusion of HAL, and begs the query as to whether the two organizations had been informed of it in advance.

The activities were all the more surprising in that the negotiations between Dassault and HAL had curiously by then ironed out any variations between the two companies, as was introduced by Dassault Aviation CEO Éric Trappier, in the presence of each the head of the Indian Air Force and the chairman of HAL, in a speech on March 25th 2015 at the biennial Aero India airshow in Bengaluru (the former Bangalore).

In a video recording (see below) launched by the Indian National Congress party, which represents the fundamental political opposition to the Modi government, Trappier declared: “You can imagine my exquisite satisfaction to hear […] from HAL chairman that we are in settlement for the responsibilities sharing, thinking about as well our conformity with the RFP [Request for Proposal] in order to be in line with the guidelines of this competition. I strongly believe that contract finalisation and signature would come very soon.”

Video recording of Dassault Aviation CEO Éric Trappier speakme at the Aero India airshow in Bengaluru (the former Bangalore), March 25th 2015. © Congress Party

Yet the very subsequent day, according to files now obtained by using Mediapart, Dassault signed the MoU with Reliance, which was quickly followed by using Modi’s overturning of the original gentle agreement and, with it, the responsibility for Dassault to partner with HAL.

The MoU prudently allowed for a “possible joint venture”. It would encompass “program and project management”, “research and development”, “design and engineering”, “assembly and manufacture”, “maintenance” et “training”. But it averted explicit point out of the tasks distributed for HAL in the tender.

With Modi’s turnaround, the road was once now clear for a new alliance, and in November 2015, Dassault CEO Trappier and Reliance Group chairman Anil Ambani signed a “strategic partnership agreement”, a more distinctive document than the preceding MoU, for the establishment of a joint project in India.

That agreement set out a undertaking by the two corporations whereby, in the case of “subsequent sales” to India which would include neighborhood manufacturing activity, it would be the joint venture organization that would be in charge of the “aircraft last assembly line”, to the exclusion of HAL (see report below).

An extract from the “strategic partnership agreement” signed on November 9th 2015 between Dassault Aviation CEO Éric Trappier and Reliance team chairman Anil Ambani. © Document Mediapart

More troubling still used to be the plan for Dassault and Reliance to take phase in fighter jet development for which HAL was once in charge. Dassault and Reliance planned to furnish “design consultancy” for a future version of the Tejas single-engined Indian “Light Combat Aircraft” (LCA) manufactured by using HAL, which had been designed together with the Indian defence ministry’s Aeronautical Development Agency.

The “partnership agreement” additionally confirmed that Dassault had infrequently any industrial interest in allying itself with Reliance. It particular how Dassault was to furnish almost each essential undertaking in the joint venture, including its “technology and know-how”, its “technical assistance”, and its “international marketing” capabilities.

On its side, Reliance used to be to provide “production facilities”. Given that the crew had at that time no aeronautical manufacturing plants, this was likely with an eye to the implantation of the future joint-venture DRAL factory close to the city of Nagpur.

Importantly, the 2nd mission given to Reliance was the express task of “marketing for applications and services with the GOI [Government of India] and different authorities (such as local states) in compliance with relevant laws”. In sum, it was to use its powers of have an effect on (see document below).

An extract from the “strategic partnership agreement” signed on November ninth 2015 between Dassault Aviation CEO Éric Trappier and Reliance group chairman Anil Ambani. © Document Mediapart

The inter-governmental settlement finalising the sale of the 36 Rafale was signed in September 2016. Two month later, on November twenty eighth 2016, Dassault and Reliance signed a “shareholders’ agreement” which set out their relationship in the future joint venture company. But the economic details of this had been so sensitive that they did no longer figure in the contract, and alternatively were contained in a private “side letter” which was signed that identical day.

It is that “side letter” that contained the funds proficient to Reliance by Dassault.

As nearly equal partners, the two companies every pledged to provide up to 10 million euros for the capital of the joint venture. Up to that point, the whole lot followed enterprise logic. But Dassault also promised a “share premium”, a supplementary sum on the rate of the shares, of a maximum forty three million euros, plus loans detailed as “not exceeding 106 million euros”.

This supposed that Dassault had pledged to provide up to 159 million euros out of the whole investment of 169 million euros, representing 94% of that total. Meanwhile, the contribution by way of Reliance, it was noted, “shall now not exceed 10 million euros, all in equity”.

Just how much of these sums used to be invested is unclear. On March 31st 2019, the DRAL joint assignment company’s capital stood at 7.5 million euros, of which Reliance would normally have been anticipated to fund half, namely 3.25 million euros. For its part, Dassault, in a announcement published on its internet site announcing the inauguration of the Nagpur plant, introduced that the joint venture represented an “unequalled Foreign Direct Investment (FDI) with the aid of Dassault Aviation of over 100 million euros, the greatest such Defence FDI in one location in India”. It disregarded to mention that its accomplice Reliance, in comparison, had made but a very modest contribution.

It seems that, in 2019, Reliance had provided simply 3.25 million euros out of a total of extra than 100 million euros, representing a saving on its section of more than forty five million euros. Presented with these figures, Dassault Aviation declined to comment whilst Reliance failed to respond.

The beginnings of the DRAL joint venture have been financially unimpressive. After its first year of manufacturing activity, signed off on March 31st 2019, it recorded a turnover of simply 250,000 euros and losses of 750,000 euros. At that rate, Dassault would be hard pressed to attain the objective of spending four billion euros in local offset agreements as set out in the Rafale contract.

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