Also Read: India might take the Rafale route and buy us ‘F35 Fighter Jet
What is a G2G defense contract?
In contrast to procuring defence equipment through an open competitive process, government-to-government transactions mean the involvement of both governments rather than companies selling weapons directly to India. Most of India’s defense contracts with Russia, India’s leading weapons provider, take place under a G2G transaction, also known as the Intergovernmental Agreement (IGAS). A Rafale Fighter Jet contract with France was also under the IGA.
G2G defense occurs between two sovereign governments, allowing complex Defense Procurement Procedures (DPP) conditions to be bypassed for flexibility. The G2G deal begins with the Ministry of Defense Defence Acquisition Council, which outlines the contract broadly. The contract is negotiated by foreign government agencies and committees of the Ministry of Defense. Both government agencies have finalised prices, delivery timelines and maintenance, along with other aspects related to arms procurement. The committee is not limited to negotiating with foreign government agencies only, but it can also coordinate with manufacturers. The final contract, mediated by the two government agencies, is approved by a Cabinet Committee led by the Prime Minister.
Why G2G trading is in priority mode for F-35 purchases
Similar to the Lafale deal, the F35 acquisition could potentially guarantee delivery and pricing on par with the US military, according to the government-to-government mode, ET reports. Long-term and tedious procedures based on the Defense Procurement Procedure (DPP) can be bypassed under G2G trading, ensuring fast delivery by eliminating the possibility of long delays that marked many non-G2G arms trades I will. In many cases, the military urgently needs weapons, as is the case with fighter jets. Often, the procurement of open competitions, which take place through the DPP, gets caught up in long delays and is cancelled after considerable negotiations.
The decision to choose a G2G transaction for Rafale Fighter Jets was intended to address the emergency requirements. The government reportedly notified the Supreme Court that the G2G arrangement, the Rafale deal, is better in terms of pricing, delivery and maintenance than the previous contracts the UPA government was negotiating. I agree to the cost. The G2G route also provided better protection against uncertainty such as sanctions and other disruptions in supply, the government said. It also meant a stronger involvement in contracting countries in India’s defensive needs.
The IAF must make it in time for a 30-man combat squadron with Hindustan Air Nautix Limited (HAL) if 42.5 is approved. “As the AMCA is still at least 10-12 years away from production, the IAF is clearly deeply interested in tentatively gaining two or three squadrons (36 or 54 jets). War. If deterrent is needed to prevent this, then obviously capacity is necessary,” an official told TOI.
The Navy said in 2022 that it would prefer G2G trade to source new carrier-type fighters, but in the long run they would prefer indigenous twin-engine fighters to meet all requirements . India is currently trying to seal off G2G deals with the French government for 26 Lafare Marine Jets.
The G2G defense deal offers some comfort due to the sovereign guarantee. In the case of the 2016 Rafale contract, the dispute in the enforcement of the intergovernmental agreement was to be resolved through a bilateral high-level group established by India and France. If the dispute between the two sides was not resolved by the group, it was to be resolved by arbitration in accordance with the United Nations Committee on International Trade Law.
The Ministry of Justice initially refused to provide a direct sovereignty guarantee for the enforcement of the Lafale contract, and the government initially wrote a “comfortable letter” signed by the French government in September 2016 by the Prime Minister. After serving it, I proceeded to ink.
Another major advantage of G2G trading is that the purchasing government receives the same benefits and protections that manufacturers offer to their own governments.
In 2019, the government said the intergovernmental contract signed between two long-time strategic partners, or the Lafare contract that the G2G contract was liable for the French government and Dassault Airlines, and the Director and Auditor. I’ve been notified. Rafale contracts with “co-op” to ensure a high level of commitment.
In addition to the possibility of better pricing and a timeline for desirable delivery, G2G defense procurement transactions are also desirable to avoid allegations of fraud and corruption that often occur through open competition.
(Use input from TOI)
