When the going gets tough the arms dealers get going
A Rafale fighter jet at an air show in Bangalore last year. The Indian government must have liked what it saw since today it was announced it had purchased 126 of them from French arms manufacturer Dassault.
Here's an old truism: When first world economies are in the doldrums there is still one tried and true place to get a jolt: the arms market. Prime Ministers and Presidents make calls on behalf of private firms in the hopes of sealing the deal.
France, looking at projected GDP growth in 2012 of a mere 0.5 percent received its jolt today with news that its aircraft manufacturer Dassault had completed a deal to sell 126 Rafale fighter jets to India. The price tag is estimated at between $10 and 11 billion. French President Nicolas Sarkozy is smiling.
The big loser in the competition to provide India with its next generation of fighters is the Eurofighter-Typhoon consortium, a partnership between Britain's BAE Systems and Italy's Finmeccanica.
The Indian Air Force is the world's fourth largest, with a reported 700 aircraft already in its fleet.
The final details may be some time in coming. It is not clear how many jobs the contract will generate in France or whether some of the manufacturing will take place in India. What is clear is that shares in Dassault jumped 20 percent when the deal was announced.