More leaks sink Scorpene; bad timing for France trying to tie down troublesome Rafale deal

NEW DELHI: More bad news for the Navy came on Thursday night with the Australian newspaper revealing more leaked content, including details of the submarine's underwater warfare systems.
The new documents put out by the Australian online newspaper come hours after the Indian Navy sought to downplay the issue, saying that there is no immediate reason for worry.

The new documents include specifics of the entire sonar system that is used by the sub to identify and target enemy vessels. These include details of the Flank Array, Sonar Intercept Receiver bands of operations and Active array transmission frequency.

The timing of the disclosure that thousands of pages of confidential information on India’s Scorpene submarine have been leaked is particularly bad for France that is trying to finally tie down a troublesome deal for Rafale fighter jets and shipbuilder DCNS, which was hoping to get clearances for a foreign direct investment proposal this month.

While the navy has been downplaying the seriousness of the breach – saying that necessary steps are being taken to mitigate probable security compromise – the leak has thrown questions on a DCNS FDI proposal worth over Rs 100 crore that hinges on the Scorpene project.

In fact, sources told the Economic Times that a team of senior officials from France was to visit New Delhi next week, hoping for final clearances in what would be the first bid in the defence sector for 100 per cent FDI under a new liberalized policy by the Modi government.

The FDI was for an Air Independent Propulsion (AIP) system that would have given greater underwater endurance to the Scorpene submarine. French company DCNS was banking on an additional order for three Scorpenes that would be fitted with AIP and had based its FDI pitch strategy accordingly.

“The leak has put up questions on how the capability of the current fleet on order has been undermined. That is being studied. So, any discussion on a new order would depend on the outcome of the study,” a senior ministry official said.

At the same time, there are worries that the leak is worse than was earlier expected with The Australian revealing more data. The newspaper has put out more redacted documents that detail the sensitive underwater warfare systems and sonar of the submarine.

The Indian Navy, which said that documents shared by the newspaper as of now do not pose a security compromise as they have been redacted, has asked French authorities to act on the leak. “The Government is examining if the impact of the information contained in the documents claimed to be available with the Australian sources is compromised. The detailed assessment of potential impact is being undertaken by a high level committee,” a navy statement read.

The leak, which according to the Australian also contained files on French frigates and its Mistral amphibious vessels, could also have an impact on a DCNS proposal to sell landing platform docks to the Indian Navy. The Rs 20,000 crore LPD contract –- for which DCNS is partnering Reliance Defence -- is in its final stage with commercial offers expected to be opened this year.

The timing of the leak also coincides with a delicate period on the Rafale fighter jet negotiations. After protracted discussions, which have lasted for over a year, the Indian and French side finally came to an agreement earlier this month to take forward the purchase of 36 fighter jets. A team from France is also expected to visit India next month to finalise the deal. However, the Indian side is now bound to raise questions on data protection and confidentiality from the French side.