Why India Is Paying More Than Indonesia for Rafale Jets: A Breakdown of the French Fighter Deal

Paris/New Delhi: India and France are in advanced negotiations over the Rafale fighter jet deal, covering pricing, technology transfer, and other key issues. The Indian Defence Acquisition Council (DAC) has approved the Acceptance of Necessity (AoN) for the purchase of 114 Rafale jets at an estimated cost of ₹3.6 lakh crore under a comprehensive capital acquisition proposal. The deal also includes six P-8I long-range maritime reconnaissance aircraft for the Indian Navy.

Deal Structure: Ready-Built and ‘Make in India’ Jets

Under the proposed deal, 18 jets will be directly procured from France, fully built and ready for operations. The remaining 96 jets will be manufactured in India under the Make in India program. French media outlet L’Essentiel de l’Éco reported that “Make in India” is India’s key demand, and no compromise is planned. France reportedly hesitated to move the assembly line abroad but accepted the deal due to its sheer scale.

Price Comparison: India vs. Indonesia

India will acquire 114 Rafales: 88 single-seat F4 jets and 26 dual-seat F4 jets, along with eventual upgrades to F5 variants. In contrast, Indonesia signed a deal in February 2022 to buy 42 Rafales for $8.1 billion (~₹68,000 crore), making the per-jet cost approximately ₹1,747 crore. India, on the other hand, is paying around ₹2,850 crore per jet, nearly 1.5 times higher.

Why India’s Jets Are More Expensive

1. Enhanced Capabilities – India’s jets are tailored to meet operational needs across extreme environments—from the snowy heights of Ladakh to the scorching deserts of Jaisalmer.
2. Comprehensive Package – The Indian deal includes advanced SCALP and Meteor missiles, HAMMER precision-guided bombs, full mission simulators, long-term maintenance, spare parts, and technology transfer, covering the jets’ entire lifecycle. SCALP missiles will eventually be produced in India.
3. Upgrades and Variants – India is currently operating F3R Rafales, gradually upgrading to F4. Additionally, 24 F5 variant jets will be purchased from France, with features comparable to sixth-generation fighters.
4. Infrastructure and Logistics – Full maintenance and repair facilities are being set up at Ambala and Hashimara airbases. An assembly line in India will add to the cost, whereas Indonesia did not set up any local assembly.
5. Engine Technology – India aims to acquire M88 engine technology from France (in collaboration with Safran) for use in future indigenous fighters like AMCA.

Value Beyond Price

French media notes some hesitancy about establishing a Rafale ecosystem in India, but the scale of the deal makes it essential. India will have factory setups, training centers, maintenance infrastructure, and extensive technology transfers, ensuring long-term benefits. While India’s deal appears costlier upfront, experts say it is strategically superior and more sustainable than simply buying ready-built jets.