The involvement of Anil Ambani owned Reliace Defence Ltd. in the Rafale Deal has become more controversial. According to an Economic Times report, Before Reliance Defence bagged the Rafale deal, it had been rejected in three major defence contracts with Russia.
- When Prime Minister Narendra Modi visited Moscow in December 2015, he was accompanied by Anil Ambani. During this visit, the $1 billion contract for Kamov KA-226 light helicopters was discussed. Even though Anil Ambani had been discussing Reliance Defence’s partnership in the deal, Russia chose to go with Hindustan Aeronautics Ltd. (HAL) – a PSU with 78 years of experience.
- In the Kamov deal, Reliance Defence was rejected for not being ‘government approved’, a criteria that Russia is adamant about. Indian government, as a matter of policy, does not ‘approve’ private companies.
- During the same visit, the $2.15 billion deal for procurement of four 1135.6 frigates for the Indian Navy was also agreed upon by India and Russia. While Reliance Defence was in talks with the Russian United Shipbuilding Corporation (USC) to be the Indian partner, the contract ultimately went to Goa Shipyard Ltd. (GSL).
- Reliance Defence also tried to bag the deal for executing the offsets of the S 400 missile defence system deal. However, Anil Ambani’s ambitions fell through once again since the Russians expressly asked for the otherwise mandatory 30% offset clause to be removed, because the S 400 is a highly advanced system.
- Ambani’s first success came in October 2016, when it was announced that Reliance Defence would be an Indian partner in the now controversial Rafale deal.
- Allegations of crony-capitalism have been raised against the Modi govt, since Ambani’s company, which has no experience in defence manufacturing, was preferred by the Indian government over the state owned HAL.
- A recent report has revealed that Ambani, on his visit to Paris when the deal was first discussed, agreed to finance a movie starring French ex-PM Hollande’s partner, actor Julie Gayet.