As the political war and blame game escalates over controversial Rafale fighter jet deal, the Defence PSU HAL headquartered in Bengaluru is worried over the impact of the deal on its existence. Hindustan Aeronautics Limited with over 29,000 employees spread across the country has very much cash strapped and now looking at a bleak future. HAL in it’s over 70 years of existence has suffered a huge financial crunch and might affect some of the ongoing projects.
A senior executive who is part of HAL’s many projects on the condition of anonymity feels the cancellation RFQ for production of 106 Rafale fighters and technology transfer has hit the PSU very badly. He said “ because of the faulty RFQ we have lost the production of Rafale fighters in our facility. As the impact we are cash strapped. We have only Rs 1,500 crore and have to pay Rs 400 crores as salaries per month approximately for the employees.”
“The SU-30 production is coming to end and the financial crunch has hit the design and development of new projects in the pipeline. We have to stop IMRH( Indian Multirole Helicopter), two aero engine development and new UAV projects apart from others’, he said and added that government should come to the rescue of HAL to bring back its glory by reviving projects in the pipeline.
Another senior retired official who has seen the Rafale RFQ from the beginning said for the first time in the history of HAL, MoD wanted to sign a contract with OEM and accordingly introduced new clauses in the RFP which were, unfortunately, not workable.
He said “ I feel there was no other option for the MoD but to cancel the proposed contract due to the defective RFP issued by the them. He said “1.Only one contract will be signed by MoD with the OEM. HAL will sign a separate contract with OEM. 2. OEM has to take the responsibility of warranty and delivery of all the aircraft produced by him as well as the 108 jets assembled by HAL. 3. OEM has to include the cost of aircraft assembled at HAL in the overall quotation and 4. Life cycle cost to be included in the quote”.
“We all know the result of negotiation with Dassault. It’s not higher man hours claimed by HAL or perception of Nirmala Sitharaman about HAL, it’s the defective RFP which pulled the curtain before the show could begin” he added.
Another official said the buyback share has affected the financial position to a great extent. He said recently the employees union demanded a pay hike and company could not give them any hike but rejected their demand because of the the financial position.
HAL has the experience of working with Dassault where over 60 Mirage 2,000 fighters were maintained and upgraded recently. Only they have orders for 73 Advanced Light Helicopters (ALH) and sources say so far there is no confirmation about 83 LCA and waiting for the confirmation.
HAL which is the backbone of Indian defence forces is struggling for its existence and became an easy prey to the political slugfest of the Rafale deal.
