India, France ink deals worth $20 billion during Sarkozy's India trip
Date created : Latest update :
French company Areva will build two nuclear power plants in west India after Prime Minister Manmohan Singh signed a €7 billion agreement with President Nicolas Sarkozy during his four-day trip to the booming nation.
French President Nicolas Sarkozy made a four-day visit to India earlier this month with an entourage that included his wife, Carla Bruni-Sarkozy, and a bevy of leading French industrialists and ministers.
Trade and nuclear power deals topped Sarkozy’s India wish list, and his jam-packed agenda featured visits to the capital, New Delhi, as well as the Indian commercial capital of Mumbai, and Bangalore, the southern city better known as “India’s Silicon Valley”.
The visit yielded around €15 billion ($20 billion) worth of civilian nuclear energy, defence and aviation deals between France and the world’s largest democracy.
Here are details of the deals signed during Sarkozy’s India visit:
France has been a loyal partner in India’s nuclear history in good times and bad, notably following India’s May 1998 nuclear tests, when France was one of the few nations that did not condemn the controversial tests.
During Sarkozy’s latest visit, French nuclear giant Areva and its Indian counterpart, NPCIL (Nuclear Power Corporation of India Limited) signed a preliminary contract for nuclear reactors and services worth about €7 billion for the construction of the first two reactors of six at Jaitapur in the western Indian state of Maharashtra.
The deals include the supply of reactor fuel for 25 years, according to an Areva statement.
S.S. Bajaj, chairman of the Atomic Energy Regulatory Board of India (AERB), and Andre Claude Lacoste, chairman of the Nuclear Safety Authority (ASN) of France, also signed an agreement for the exchange of technical information and cooperation in regulation of nuclear safety and radiation protection.
The agreement renews and updates the existing arrangement, which took effect in 1999 and was renewed in 2005.
European group Airbus signed lease contracts to supply A-330 aircraft to India's Jet Airways and state-run carrier Air India in separate deals totalling €2.8 billion, according to Indian government officials.
French tyre-maker Michelin signed a protocol contract with the southern Indian state of Tamil Nadu to invest around €600 million in a factory.
In the lead-up to Sarkozy’s visit, French firm Dassault Aviation was hoping to pick up a $1.2-billion contract to revamp 56 Mirage-2000 aircraft that France sold India nearly two decades ago.
But the pricing of the upgrade has been a major stumbling block, leading Indian officials to play down the chances of a deal before Sarkozy landed in India. According to Indian news reports, the pricing package offered by French companies Dassault Aviation (aircraft manufacturer), Thales (weapons systems integrator) and MBDA (missile supplier) was around 30% higher than what New Delhi was initially ready to pay.
In the end, India and France agreed to a €1.6 billion deal to upgrade the Mirage-2000 combat jets, said Sarkozy during a joint press conference with Indian Prime Minister Manmohan Singh in New Delhi. But protracted negotiations are expected before the pact is signed.
A cautious joint statement that was issued following talks between Sarkozy and Singh said: “Discussions concerning the upgrading of Mirage 2000 aircraft are expected to be finalised soon.”
RAFALES STILL FOR SALE
Arms-hungry India is expected to spend around $112 billion on defence acquisitions by 2016, and Paris would like to see its Rafale fighter jet feature in the acquisitions, despite the king of Bahrain’s dismissive “yesterday’s technology” quip about the Rafale, which was revealed in the WikiLeaks documents released earlier this month.
The competition, however, is intense, with US F-18 fighter jets, Russian MiG-35s and Eurofighters all in the race. In the end, there was no deal on the Rafale, although Sarkozy said he was still hopeful that India would buy the French fighter jet.
Indian experts have been dismissive of what they call “a champagne effect”, or an inflated price tag, for engineering products with the “Fabriqué en France” label.