Technology transfer has been a critical component of Dassault’s Rafale export strategy. Dassault has offered major technology transfer as a sweetener for most of its bids, including the failed bids in Brazil and Switzerland.
Recently, an Indian minister stated that Rafale fighter aircraft will be produced in Nagpur, in Maharashtra state. However, to determine whether or not the transfer of technology and production will occur, we must examine France’s history of technology and production transfers.
France has previously engaged in collaborative fighter programmes with the United Kingdom and Germany, such as the Jaguar and Alpha Jet. However, these were cooperative projects with independent production lines for each nation.
It’s worth noting that certain French fighters may use sub-components or engines manufactured by other nations. For example, the Rafale has British ejection seats. However, this does not imply full production in another country. It is the same with Rafale aircraft.
Egypt, Qatar, the UAE, and India purchased Rafale jets but have yet to obtain any technology required for independent production, maintenance, and upgrades. So far, France has not given full technology transfer for the Rafale to any country.
While France has typically been hesitant about releasing key Rafale technology, future agreements may include more technology transfer, depending on strategic relationships and political factors. However, no actual agreements exist at this time.
Consider each example individually and then address the Indian deal at the end.
Egypt was the first export customer for the Rafale, purchasing 24 planes in 2015. As part of this agreement, Egypt’s state-owned Arab Organisation for Industrialization was given technologies and licences to assemble Rafale kits locally. This was Egypt’s inaugural large aircraft construction project.
Egypt and France inked further agreements in 2018 to try to move forward with their localisation plans, but meaningful results have yet to be seen.
The COVID-19 epidemic began in 2020 and is also believed to have slowed work towards establishing Rafale manufacture in Egypt.
However, as of 2022, sources indicate that while some Egyptian technicians have been trained in France, major technology transfer and full Rafale manufacturing have not yet occurred in Egypt.
Egypt faces challenges like infrastructure, an industrial ecosystem, and a supply chain.
Qatar acquired 36 Rafales in 2017, agreeing to assemble a part of these jets using transferred technology locally. However, precise statistics on the degrees of technology transfer and local production are not publicly available.
Following prolonged talks, the UAE agreed to purchase 80 Rafales by late 2021. According to media sources, the agreement contains provisions for UAE-made components, implying that some knowledge transfer is expected. However, the exact circumstances have yet to be revealed officially.
Now, let’s look at the Indian deal.
Previously, India and France negotiated the Mirage 2000 production line transfer to India, but the deal was too expensive and incomplete. However, Indian interest in the Rafale aircraft arose.
Pre 2014, during the Medium Multi-Role Combat Aircraft (MMRCA) tender, Rafale won the bid with promise of total technology transfer. The goal was to provide India with the knowledge and skills to independently build more than one hundred Rafales. On the other hand, discussions between HAL and Dassault over the continuation of the local production agreement were challenging. The French aerospace company Dassault was adamant about not handing over all of its technologies, and it questioned Hindustan Aeronautics’ capacity to manufacture Rafales. Following the conclusion of the elections, the agreement was finally scheduled to be signed by the newly elected government.
On the other hand, the subsequent government decided to purchase only 36 Rafales and to deal with a local partner to manufacture them in India. The facility is not being used because of allegations of corruption in the Rafale deal and the insolvency of the Indian partner.
Dassault breached its commitment regarding offsets, as noted by India’s Comptroller and Auditor General (CAG). As a result, the Indian government revoked the offsets regulation for single vendor transactions.
A prospective “Rafale-M” derivative for the Indian Navy, which could involve a more extensive technology transfer and possibly production capabilities, is the subject of discussions between France and India. Nevertheless, the precise terms and extent of technology transfer are pending negotiation.
It would appear that the key concerns are differences regarding the scope of intellectual transfer, infrastructure and ecosystem preparation in the target countries, and Dassault’s level of protection of its advanced jet technology.
With the surge in orders, France must build extra infrastructure to manufacture Rafales. The transfer of the Indian Rafale assembly to the Indian production line remains to be seen. This plant has political and regulatory hurdles as the shares of the insolvent Indian business partner remain.