M A I N   N E W S

Fierce contest for aircraft deal 
Tribune News Service

The cost difference between the two companies is ‘marginal’ when seen in the context of the overall cost of the tender that is more than Rs 42,000 crore. Also, on broad parameters like per unit cost, engine costs, maintenance costs and operating costs, there isn’t much difference between the two.

“The Contract Negotiations Committee (CNC) of the Defence Ministry opened the commercial bids and read out the offers made by the Eurofighter and Dassault Rafale in the presence of their representatives. Now, the ministry will evaluate and examine their proposals and it will take another 6-8 weeks to finalise the name of the lowest bidder,” said Defence Ministry spokesperson Sitanshu Kar.

As per the Defence Procurement procedure (DPP), the bidder charging lowest price and meeting all the requirements specified in the tender has to be offered the contract. The ministry will now start calculating the Life Cycle Cost (LCC) of the two aircraft, which is to be operated for 40 years or 6,000 hours, said the spokesperson. Final commercial negotiations with the L-1 vendor (lowest bidder) will begin before the contract is ready for signing before the end of this fiscal.

The government had earmarked Rs 42,000 crore for the deal in 2007 but after the negotiations, if it is required, the funds can be increased significantly. Decks were cleared for opening the commercial bids after the Defence Acquisitions Council (DAC), chaired by Defence Minister AK Antony, approved the offsets evaluation reports of the Eurofighter Typhoon (backed by UK, Germany, Spain and Italy) and the French Rafale jets on October 7.