Article Posted on : - Apr 11, 2015

Prime Minister Narendra Modi and French President Francois Hollande during the joint statement at the Elysee palace. A PI Photo.

PARIS (PTI): India will buy 36 Rafale fighter jets in flyaway condition from France "as soon as possible" after Prime Minister Narendra Modi and French President Francois Hollande on Friday agreed to conclude an Inter-Governmental Agreement bypassing the protracted negotiations for purchase of 126 such jets.

Taking Indo-French strategic relationship to a new level Modi and Hollande also decided to move ahead with the stalled Jaitapur nuclear project in Maharashtra.

"Keeping in view the critical operational necessity of fighter aircraft in India, I have asked President to provide 36 Rafale jets in fly-away condition as quickly as possible after agreements between both countries.

We both have decided that these will be provided to India in modified terms and conditions," Modi announced at a joint news conference with Hollande after their summit talks at Elysee Palace.

A joint statement issued after the talks said the two leaders agreed to conclude an Inter-Governmental Agreement for supply of the aircraft on terms that would be "better" than that conveyed as part of a separate process underway, an apparent reference to the ongoing talks that kicked off in 2012 for years for the sale of 126 Rafale fighter jets valued at 12 billion USD.

"The delivery would be in time-frame that would be compatible with the operational requirement of IAF and the aircraft and associated systems and weapons would be delivered on the same configuration as had been tested and approved by Indian Air Force and with a longer maintenance responsibility by France," it added.

With “Make-in-India” being the theme, the two sides signed about 20 pacts, covering areas like civil nuclear energy, urban development, railways and space.

The Rafale deal has been bogged down over cost and Dassault Aviation's reluctance to stand guarantee for 108 planes to be made by state-run Hindustan Aeronautics Limited (HAL).

"Just as we are delivering the first upgraded Mirage 2000, I am delighted by the decision of the Indian authorities which gives a new impetus to our partnership for the next decades and comes within the scope of the strategic relationship gathering France and India," Eric Trappier, Chairman and CEO of Dassault Aviation said.

Earlier on Friday, Modi met CEOs of Frence companies dealing with defence and they expressed interest in setting up technological and industrial projects in India.

With regard to the Jaitapur project, Modi said, "We made progress."

The joint statement said the two leaders encouraged their commercial enterprises for an early conclusion of techno-commercial discussions on the proposal for construction of six 1650 MW nuclear plants in Jaitapur with due consideration to project viability and in the framework of an ambitious partnership for large and critical components.

An MoU was signed between French company Areva and Larsen and Tubro "which will widen the scope of our industrial cooperation as well as the conclusion of pre-engineering studies agreement," it said.

"The two leaders also urged their atomic energy establishments to lay an ambitious foundation for the future of India-France civil nuclear cooperation, including a wide range of subjects, including in the area of civil nuclear liability," the statement said.

A pact related to pre-engineering agreements between NPCIL and AREVA was signed in connection with studies that is intended to bring clarity on all technical aspects of the plant so that all parties (AREVA, ALSTOM and NPCIL) can firm up their price and optimise all provisions for risks still included at this stage in the costs of the project.

It will also enable transfer of technology and development of indigenous nuclear energy industry in India.

France also informed India of its decision to implement a scheme for expedited 48 hours visa issuance for Indian tourists.

"There is no such sphere where India and France are not cooperating. France is among India's most valued friend," Modi said.

France also announced an investment of 2 billion euros (about USD 1 billion) in India as Modi invited French companies to pump in money in technology in the fastest growing economy.

France will invest 2 billion euros in India, Hollande announced at a CEO forum here.

Inviting French investors, Modi said, "There is no bigger market than India. It is also the fastest growing economy since the last six months. Various rating agencies like World Bank and Moodys have said in one voice that India is the fastest growing nation.

"It is rare to find a country with a market, with the government determined on development and demographic dividend.

Investors are usually worried about the security of intellectual property (IP). Only democracies like India can guarantee that," he said.

Addressing the CEOs forum, Hollande said: "We are ready to allocate through French companies 2 billion euros to support India's sustainable development."

He said France will partner India in Urban development of infrastructure like railways and defence and nuclear sector

The two sides also signed an agreement in the field of space under which they will launch planetary explorations jointly.

Noting that President Hollande has supported 'Make in India' initiative especially in the defence sector, Modi said at the joint news conference that the two countries have decided that the Rafale jets will be provided to India in modified terms and conditions.

"Today, we have taken defence cooperation between India and France to new levels."

"I had very good talks with President Hollande. Our defence sector ties are old. In defence equipment and technology. France has always been a reliable supplier. From fighter jets to submarines, our ties have been foremost," he said.

Modi said that in the area of Nuclear power, France has been a major partner with India.

"I am happy that in Jaitapur, we have made progress on setting up 6 nuclear power projects. Both have signed an agreement on reducing the cost of power production and more technical support and further study.

Especially, Areva and L&T have signed an agreement for making forgings in India. I feel this agreement is very significant and will be a perfect example of 'Make in India' and will take India to a new place in the area of advance technology." he said.

Modi noted that there is a challenging atmosphere in the world and that there is turbulence in different areas due to which all are affected. "In this changing world, there are a number of uncertain questions on stability."

"Terrorism is spreading and taking new shapes. This challenge is being tackled in different forms and to tackle that an extensive strategy is to be evolved. Be it Paris or Mumbai, India and France have understood each other," Modi said.

The Prime Minister said it is the responsibility of every nation to lend support in the fight against terror and not allow terror groups to take shelter and punish the terrorists as soon as possible.

France also agreed to help in the development of three smart cities in India, including Puducherry and Nagpur.

Hollande strongly backed India's bid for permanent membership of UN Security Council so that the largest democracy becomes "a part of all resolution crisis issues".

Hollande said defence was an important topic of his discussions with Modi and expressed keenness to harness technology in this field for common security.

He also said that the two countries had signed an "important agreement" to proceed on the "iconic" Jaitapur nuclear power plant.

The French President said he will ensure availability of two billion euros through his country's companies for sustainable development in India.