The Centre on Monday scrapped the $20 billion dollar Medium Multi-Role Combat Aircraft (MMRCA) deal for 126 Rafale fighter jets.

The development came after Prime Minister Narendra Modi decided to buy 36 Rafale fighter aircraft in fly-away condition from the French government directly, sidestepping a gruelling three-year negotiations for the Medium Multi-Role Combat Aircraft (MMRCA) tender, for which Rafale was shortlisted.

Defence Minister Manohar Parrikar also clarified that the IAF’s MiG-21s were not being replaced by Rafale fighters but by the Light Combat Aircraft Tejas. He explained that the Rafale fighters had a bigger range with much more capacity for weapons.

Parrikkar asserted that all future defense purchases would be on a government-to-government basis.

Noting that MMRCA negotions had entered into a “loop” or a “vortex” with no solution in sight, Parrikar said direct negotiations with France will now decide how many more Rafale jets have to be bought and if the purchase will be under ‘Make in India’ programme.

Under the MMRCA contract, while 18 aircraft were to be bought off the shelf, 108 were to be manufactured by state-run Hindustan Aeronautics Limited under a license from Dassault Aviation, the manufacturers of Rafale.

Though Rafale was shortlisted in 2012 after a five-year tending process, a final contract could not be signed due to differences over two issues - pricing and Dassault’s reluctance to stand guarantee for planes manufactured by HAL.

Parrikar also reacted to the comments made by BJP leader Subramanian Swamy. He said that the deal was a complicated one and that he will take time to explain it to Swamy.

At the moment, 36 aircrafts have been given a go ahead and 90 more are to be purchased. The Defence Minister indicated that the price for the purchase yet to be made has not been decided.

(With inputs from PTI)