An alternate theory of the MMRCA process – II

Editor’s Note: Yesterday we published the first of a two-part analysis of the process of acquisition of 126 Medium Multi Role Combat Aircraft (MMRCA) by the Indian Air Force (IAF), written by Mark, a long-time observer of the process. The first part looked at the build-up to the process of the tender. This is the second and concluding installment.

The defense media which had received quite an insight into the world of each of the manufacturers in the long play from RFI to RFP to competition were surprised by at least one of the two players, who refused to engage them: Dassault. The Russians were never quite into opening channels with the media and so their absence from the MMRCA discourse in the media was no surprise. However, it was the French, who, maintaining a complete ‘no talk’ policy with the media during the entire campaign, turned out to be the actual mystery boys. Even as much of the media scratched its head on how the French could possibly hope to win a 126 aircraft deal without selling it to the larger audience, they were equally perplexed by the repeated claims by Eurofighter that they were indeed in the lead, well before the field trials were over.

In hindsight, the question remains, were Eurofighter ‘led along’ by their ‘sources’ to make them strong votaries, backers and supporters of the ‘process’? As early as January, 2010, India’s ambassador to Italy was quoted by Reuters saying that the Eurofighter Typhoon is “leading the race”. In the next two years, similar statements of confidence were echoed by Eurofighter proponents.

For Dassault, possibly, the action was being taken care of elsewhere. Weeks after the Trial Evaluation team’s report was submitted, Times Now broke the story that Rafale and the Eurofighter were the top two aircraft recommended by the IAF. The Times Now story got everything right, though it was rubbished for weeks thereafter by every contending manufacturer, their consultants and the little knowing talking heads in print and on television. Rather interestingly, there was one point that the correspondent made that was subsequently quoted in a blog, Livefist:

“Srinjoy’s sources (the name of the Times Now correspondent) tell him the air force has based its trial evaluation report (submitted on August 1) on the overarching and unstated directive that it needs to select a “modern western combat aircraft”.

This seemed to point yet again to the belief that trials and evaluation were predetermined rather than professional or transparent.

As the story broke, the IAF decided to disown what now is known to be its ‘result’. The Indian Air Force chief called select journalists into an ‘off the record’/background chat.

In what turns out now to be a mastery of gobbledygook, this is some of what the media took away from the briefing. Livefist reported the conversation on August 12, 2010, thusly:

“Point One, The Indian Air Force won’t choose a twin-engine aircraft in the MMRCA, if a single-engine aircraft can “do the job” i.e, is satisfactorily compliant on all 643 test points that each of the six airplanes were tested for during the Field Evaluation Trials (FETs).”

Clearly, the IAF had turned the principle of what it was choosing on its head. The MMRCA was no longer about an aircraft below 20 tonnes and it sure wasn’t about replacing the MiG-23 or the MiG-27. Now the ‘process’ had neatly turned the tables on single-engine aircraft, which now had to prove (more than twin-engine aircraft) that they could indeed ‘do the job’.

Livefist goes on to say:

“Point Two, and this is a biggie — The model being used to gauge cost is not the Life Cycle Cost (LCC) model (American) as was previously thought. In other words, no complex formulae on future savings on maintenance and overhaul. Do you see why I used the word bombshell in the post title? :)”

In effect, the bell had been rung for single-engine aircraft. Rumors that the IAF continued to circulate over the ensuing months persistently built credibility around the position that the IAF had preferred twin-engine aircraft over those with a single engine.

Livefist continued:

“Point Three, cost is going to be a big determinant. Out of the six aircraft that are judged compliant, the cheapest will be identified as L1, and will logically be the chosen aircraft.”

That innocent and perfectly rational point hid the intent: There was no way in which a single-engine aircraft could become a part of the final mix if the preference was for twin engines.

And then came what turned out to be the biggest whopper:

“Point Four, the air force’s trial report has been submitted to the MoD, but the latter hasn’t approved it yet. The trial report strictly contains a tabulated representation of each contending platform’s compliance or otherwise for each of 643 test points. Significantly, the trial report does not quantify the level of compliance of each airplane, but rather leaves this for the MoD to understand. In other words, the trial report has all the data and results, but no recommendations, no merit list, no explicit downselect, no stated eliminations, nothing.”

On the contrary, and as everyone now acknowledges: It was an explicit IAF down select and the MoD had nothing whatsoever to do with it.

In effect, the IAF wanted to mask its preference and would go to any lengths to ensure that the eventual outcome had the necessary credibility even while trying to maintain the mask of having delivered a ‘professional’ evaluation: one that the air chief would build up as legend in the days before the announcement, as a process that should be patented. The IAF was building the story of a ‘professional’ evaluation that, surprise, surprise, delivered the very aircraft that the IAF wanted before the tender was even floated.

In the months that followed, the IAF quietly and systematically laid out its cards. Journalists were briefed about the MiG-35 not having made it, to a point that a concerned Russian Air Chief stepped in to ask whether the reports were true. Questions were planted in the media on the ‘independence’ of the air force if the Americans got the deal even while, ironically, acknowledging that the US had the best platforms on display. (Livefist, September 1).

And when the DRDO threatened to upset the apple cart by selecting the GE F-414 engine for the LCA Mk II, which runs the Gripen and F/A-18, instead of the Eurojet engine, which powers the Eurofighter Typhoon, air force officials jumped in with alacrity to categorically state that it didn’t mean a thing for the MMRCA.

In the meantime, the Eurofighter team was happily plugging away its “stories”. The Indian media was treated to a range of gems starting from the declaration of victory to comparing the Eurofighter to the F-22; plugging loopholes by stating that the AESA was around the corner, no further away than 2015 and holding its board meetings in Delhi. To give them their due, they knew that the Eurofighter needed selling and they began pulling out all stops. Obliging European media, including the Daily Telegraph happily parroted the line that Eurofighter was way ahead of the rest of the world in the contest.

Once again, Rafale stayed silent, unmoved by the whole process, almost as if they never perceived it as a contest. The AESA variant of the Rafale’s RBE2 radar was validated in the 2010 tests and met all operational requirements. The first AESAs would be incorporated in Tranche 4 of Rafales which is up for delivery in 2013. Despite the clear evidence that the AESA tested out during the Indian trials were far from operational, it didn’t seem to bother the ‘process’ which had, ironically, knocked out the Gripen principally on the AESA not making the cut and being operational enough.

However, there was obviously something not all tied in and IAF Headquarters was getting concerned that the process was getting a little too involved in issues that didn’t seem to be the strongest points for the chosen two: the technical offset programs.

As the defense ministry tied itself up in knots on the technical offset issue, warning bells were going off for the air force. Its officials seemed to be in a barely-veiled hurry to get the deal done as soon as possible.

In the period of October to November, less than three months after the IAF had put in its report, the air chief told the Aviation Magazine Vayu in October,

“The IAF has completed the Field Evaluation Trials on all six M-MRCA aircraft and has submitted its Staff Evaluation Report to MoD for further processing. The likely time frame for completion of various activities before the contract is signed is about 6-8 months. So, we expect the contract to be signed by March 2011. From thereon, the induction should begin by mid-2014 onwards.”

Incidentally, in the same interview, the air chief also pushed for the Mirage 2000 upgrade that was calculated to tot up to a neat $2 billion or roughly the cost of 40 new F-16s or 60 new Gripens. The Mirage 2000 upgrade, another project high on the agenda of the IAF, seems to defy logic as MoD officials pointed out to the Indo-Asian News Service that the upgrade is likely to give an additional life of 5 years above its initial projected life of 30 years; cost $79 million apiece and take 9 years for the 50 odd aircraft to be upgraded as opposed to the 6 years promised for delivery of 126 Rafales.

As the MoD continued to dither over the state of the offset proposals, the pressure was building up from the IAF. The air force saw an opportunity in the MoD’s inability to get the attention of its political masters when the Defense Minister waded into the Kerala state elections. By the end of March, the IAF had made up its mind. The commercial proposals were to expire by the end of April and asking for an extension meant that the issue would likely be delayed towards the end of the year.

In early April, the six competitors were told to re-submit their technical offset proposals by mid-April. Even as the competitors went to file, it appears now that not all of them managed to hit the deadline and were possibly given extensions.

With less than 48 hours to go, the IAF shoved the deadline at the MoD and forced it to play ball. Faced with an outgoing chief who had taken his campaign public, the defense ministry was cornered even though it had taken an ‘in principle’ decision that the process would be technically correct and free of political and strategic pressure. But what it did not anticipate was the IAF’s hurry.

Even before the Technical Oversight Committee had been constituted to examine and endorse the correctness of the trial procedures and the results, and even before the technical offset proposals had been opened to examine whether the two final contenders were actually technically compliant, the IAF had forced the decision. In the midst of an election campaign the MoD acquiesced, apparently disinclined to create any problematic issues for its minister.

In the months that have followed, the other contenders stood in stunned silence as the “transparent and technical process” delivered a result that seemed to have little, if anything, technical. None of the aircraft, including the Rafale and the Eurofighter met all the 643 parameters even though meeting ALL the ASQRs was a MUST.

The evidence of where the two aircraft fall short comes ironically from their own government reports. The Eurofighter’s AESA Radar will be operational by 2015. The Rafale says an operational AESA on a Rafale comes on board in 2013. Rafale’s RBE-2 radar has questionable Air-to-Sea and A-A modes.

The Eurofighter had the lowest multi-role capability of all the aircraft and fell alarmingly short on ground attack capability. According to the UK Comptroller and Auditor General:

“The Tornado GR4 remains the Department’s preferred ground attack aircraft. Newer Typhoon aircraft will have progressively enhanced multi-role capability with, for example, laser guided Paveway IV bombs and Storm Shadow cruise missiles by 2018. By this time Typhoon is likely to be the aircraft of choice for both ground attack and air defense.” (Page 5).

The Electronic Warfare suites are about adequate though troubled by issues such as jamming and ESM target acquisition for low frequencies.

The then air chief, like the IAF insiders giving unofficial briefings to media, admitted that the US aircraft were well ahead. Talking to India Strategic for its Paris Air Show Daily, the Chief was quoted as saying “In all fairness, all the six aircraft in the competition were good, and more or less close to one another in performance. But some of them had to be out, and some had to be in, and that’s it. Let’s say that the two European finalists were the most-compliant in the 600-plus parameters that the IAF selection team had set.” The journal goes on to say, the Air Chief observed that admittedly, the US had the best of the combat radars, weapons and systems.

So, if all the aircraft did not meet the 643 parameters and if a judgment call was taken on the aircraft by the IAF rather than a technical down select, why is it being touted as such?

Does anyone really have a problem if the IAF has an obvious preference for the Rafale?

The answer probably lies in the two insurmountable challenges for the French if all the six or even a third aircraft from the remaining six were put on the same table: Cost and the ability to meet the offset requirements.

You don’t really need too much mathematical acumen to figure out that the gameplan from day one was to buy a twin-engine aircraft. At between $90 million and $100 million apiece, a 126 aircraft would come up anywhere between USD 11 to 12 billion: precisely the figure getting quoted by every Indian media story to date. That was the first and the last piece of the puzzle: The cost projected to the media right from the start was about that number. While the numbers quoted subsequently for both aircraft were much higher, those for the single-engine aircraft were at least half the number.

As the IAF prodded a reluctant MoD, chained in by a minister who would rather have procedural perversion over charges of monetary corruption, a fait accompli was in the making. Needless to say, the only people who seemed to be really ‘taken aback’ was the Eurofighter lobby and their governments, who were the last remaining participants in the great Indian ‘smoke and mirrors’ show.

It is perhaps unsurprising that recent reports seem to indicate there were serious misgivings about the calculations used to identify the Rafale as the L1. According to a report in India Today, “Two senior officials of the defense ministry have questioned the methods adopted by the contract negotiation committee which concluded that Rafale was the lowest bidder. The two officials – additional financial advisor and a joint secretary in the ministry Prem Kumar Kataria, and finance manager (air) R.K. Arora – are members of the negotiation committee that comprises senior ministry officials and Indian Air Force (IAF) officers. The two officials noted that certain assumptions had been made about Rafale’s bid to declare it as the lowest bidder, but no one had validated it. The officials initially refused to sign the minutes of the committee. They later signed after making their reservations known. They put written notes on the file on January 24, according to officials privy to the negotiations.”

It is important to point out here that such disputes about assumptions on Life Cycle Cost are neither new, nor necessarily point to any kind of legerdemain. The most raging dispute of a similar nature took place in calculations made in Norway and, earlier, Austria. Indeed, the Norwegian assessment was far more astounding given that it actually scored arguably one of the the world’s cheapest single engine aircraft as many times more expensive than the F-35.

But in possibly a word of caution to the IAF not to push the “process” too far, the defense minister was quoted on February 17 by PTI as saying that “contract negotiations (will) take place for over six months and after that the deal will have to pass through eight stages. It will have to pass through scrutiny in eight stages. After CNC, it will come to defense ministry. In ministry also, there will be minimum four stages of scrutiny by Defense Finance. Then it will go to independent monitors appointed by the CVC and then go to the National Security Council Secretariat and Finance Ministry.” He repeated this at his press conference at DefExpo 2012, almost two weeks back.

There is no reason to suspect that the Rafale should not have been chosen and that is really not the issue under contention here. What this analysis points out is that at every stage of the game, there was a clear preference and it appears that all allowances were made for an eventual result.

This piece doesn’t argue that the selection shouldn’t have been what it was: the Rafale. There is no specific expertise that can be brought to bear on an evaluation that has been alarmingly quiet on what parameters the air force “technically” applied and got a winner. Maybe it will come in time.

Equally, the Rafale and the Eurofighter were possibly the best contenders IF all things were equal given that the MiG-35 was a bit of a paper plane, the Gripen NG was still a partial demonstrator and the F-16 and F/A-18 were long in the tooth.

But few things were equal as such and the decision towards a Rafale was “shaped” by the IAF’s predilection (to put it mildly) for a winner. Given that these are technical assumptions, a good, hardworking exercise should clear the air.

However, what is less likely to be sorted out very easily is the probe prompted by the letter from a Member of Parliament. Unfortunately for the air force, and for Rafale, these issues will continue to crop up for the simple reason that the whole process was kept regimented and no one has really bothered till date to present the whys and wherefores of this process to the larger audience.

Any debate on the relative merits of the aircraft has been limited and extraneous issues were “smoked up” to divert attention and crucial junctures of the process. Now, with one aircraft left on the tarmac, it isn’t going to be easy to avoid having to explain why the Rafale made it, for much longer.

Here is some final food for thought:

First, the odd mix of single and twin-engine aircraft created a new format for procurement flexibility: Where one would have thought that having such a diverse variety of aircraft would make evaluation difficult, the reality is that it makes it easier: Any one type of equipment can be knocked out by showing an arbitrary preference for another.

Second, the entire process had just one moment of public, national limelight: When the American aircraft were ‘disqualified’. It was a move that played superbly to the Indian gallery and, as such, obscured the real issues.

No commentator worth his salt actually sat down to analyze the purely technical merits and demerits of the shortlist as everyone reveled in an orgy of celebration on how India, yet again, showed the Americans their place.

For a decision supposedly only “technical”, it was a very strange debate. Indian commentators actually spent time discussing the politics of what was “acknowledged” repeatedly to be meant to be only a “technical” decision. That game and debate was played out all over again when the losing Europeans sought to play the “political” leverage card, as the IAF and the defense ministry stayed stoically focused on “technical decisions” and “lowest priced” aircraft.