India negotiating to buy 63 Rafale jets from France: Le Monde

PARIS (REUTERS) - India is negotiating to buy 63 Rafale fighter jets made in France for 7.2 billion euros (S$10.4 billion) with a view to reaching a deal during the Indian prime minister's visit to Paris starting on Friday, French newspaper Le Monde reported. "The discussions went on through the night and were still going on this morning," Le Monde quoted a source close to the matter as saying. "The idea is to announce the contract during Indian Prime Minister Narendra Modi's visit to Paris on Friday or Saturday,"the source added.

Neither Dassault Aviation, which builds the Rafale or the French president's office could immediately be reached for comment. The French defence ministry declined to comment.

Indian officials confirmed that a major push was on to reach an agreement to buy Rafales during Modi's visit to Paris, with one holding out the prospect of an announcement - if not a final deal - if India is able to secure more favourable terms.

Earlier, the Hindustan Times and one widely-watched defence blogger said that a direct government-to-government contract to buy a smaller number of planes than the 126 originally envisaged under a tender deal one possible outcome because of problems linked to localizing production of most of the planes in India.

Blogger Nitin Ghokale, a veteran defence correspondent, said the talks focused on buying between 60 and 63 combat jets. "It's correct that discussions are under way, but a contract announcement is a bit of hype," said one Indian official who requested anonymity. "If things work out and terms are more attractive than earlier, then maybe an understanding." Modi is in France for a two-day state visit. There is due to be a signing ceremony for various contracts late Friday and a joint news conference with President Francois Hollande at 1800 (1600 GMT).

Talks on the proposed Rafale purchase have been under way for more than three years, trying to resolve differences over pricing and local assembly.

The deal was initially worth US$12 billion (S$16 billion) but is now widely estimated to have jumped to US$20 billion, primarily because of the implications of building some of the jets in India.

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