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http://in.reuters.com/article/2015/01/1 ... PM20150114
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Wed Jan 14, 2015 8:26pm IST
French officials to visit India to rescue stalled Rafale jet deal
A French delegation will visit New Delhi this month to salvage an agreement to supply 126 Rafale fighter jets to the Indian Air Force that has hit a snag over the local assembly of the planes,
threatening to derail one of the world's biggest defence deals.
India is insisting that France's Dassault Aviation take full responsibility for the production of the aircraft at a state-runfacility in Bangalore under the 2012 bid offer,
Indian defence ministry officials said.
France has said it will help Hindustan Aeronautics Ltd stick to delivery schedules,
but that it cannot give guarantees for production of the aircraft made at a facility
over which it has no administrative or expert control.
Military experts say the deal could cost India $20 billion,
double the original estimate,
because of the benchmarking of aircraft prices and a roughly 5 percent annual cost increase.
"The credibility of India (as an arms buyer) is already pretty shaky and it's going to get shakier (if they cancel the Rafale deal)," said Rahul Bedi, a defence analyst at IHS Jane's.