Fact-Check: N Ram is lying in his The Hindu article about the Rafale Deal, here’s how

“There are three kinds of lies: lies, damned lies, and statistics.” – goes the popular phrase. Parameter 2007 Tender 2015 Deal Currency Total Aircraft 126 36 Aircraft directly from France 18 36 Winning Bid/Deal Size 19.5 7.85 Euro Bn Price per aircraft 154.76 218.06 Euro Mn Flyaway Cost per aircraft 79.3 91.70 Euro Mn Total Flyaway Cost of fighters in the deal 9.99 3.30 Euro Bn India Specific Enhancement 1.40 1.30 Euro Bn ISE per aircraft 11.11 36.11 Euro Mn Balance Cost 8.11 3.25 Euro Bn Balance Cost/Aircraft 64.35 90.24 Euro Mn Price increment/annum from 2007 to 2015 3.05% Not Applicable Flyaway Cost per aircraft in 2015 after escalation 100.85 Not Applicable Euro Mn Cost Escalation The most important takeaway from various open sources like The Hindu article, Indian Express report, interview of Arun Jaitley and recent parliamentary debate is that there was an escalation clause in the winning bid submitted by Dassault in 2007. Year Escalation in flyaway Cost Escalation in Balance Cost ISE Cost-Constant Total Cost/Aircraft 2007 79.30 64.35 11.11 154.76 2008 81.72 66.31 11.11 159.14 2009 84.21 68.34 11.11 163.66 2010 86.78 70.42 11.11 168.31 2011 89.43 72.57 11.11 173.11 2012 92.15 74.78 11.11 178.05 2013 94.96 77.06 11.11 183.14 2014 97.86 79.41 11.11 188.38 2015 100.85 81.83 11.11 193.79 Takeaway from above table: Escalated total aircraft cost in 2015 – Euro 193.79 Mn Flyaway Cost + ISE Cost = Euro 111.96 Mn Scenario 2 – ISE Cost with escalation The following table gives the total price of the aircraft after considering escalation in per aircraft flyaway cost, per aircraft balance cost and per aircraft ISE cost. Year Escalation in flyaway Cost Escalation in Balance Cost ISE Cost-With Escalation Total Cost/Aircraft 2007 79.30 64.35 11.11 154.76 2008 81.72 66.31 11.45 159.48 2009 84.21 68.34 11.80 164.35 2010 86.78 70.42 12.16 169.36 2011 89.43 72.57 12.53 174.52 2012 92.15 74.78 12.91 179.85 2013 94.96 77.06 13.31 185.33 2014 97.86 79.41 13.71 190.99 2015 100.85 81.83 14.13 196.81 Takeaway from above table: Escalated total aircraft cost in 2015 – Euro 196.81 Mn Flyaway Cost + ISE Cost = Euro 114.98 Mn Price Comparison Now that we’ve factored in the price escalation bit, let’s compare the price in the old deal and the new. Comparison 2 In this comparison, we compare the overall per aircraft cost as per 2015 deal with overall escalated per aircraft cost as per 2007 deal; ISE cost Year Flyaway Cost per aircraft Balance Cost per aircraft ISE Cost per aircraft Total Cost Escalated price of 2007 deal in 2015 100.8 81.8 14.1 196.8 2015 91.7 90.2 36.1 218.1 If we consider an escalation in India Specific Enhancement cost as well, price difference between the 2015 deal and escalated cost of 2007 deal narrows further to only 10.8%.