UPDATE 1-Dassault seeks European drone, Indian Rafale deals

Thu Jul 25, 2013 5:03am EDT

(Adds further comments on Rafale, drones; background)

PARIS/NEW DELHI, July 25 (Reuters) - France's Dassault Aviation called for two new European drone projects and urged completion of a $15-billion fighter deal with India as France's defence minister began a visit to the country.

The maker of luxury jets and Rafale warplanes warned of the risk of squandering European know-how after France ordered drones from the United States and stepped up pressure for the launch of new combat and surveillance drone projects.

"After its maiden flight last December, nEUROn (combat drone) demonstrated the exceptional know-how of France and Europe, but the government is looking overseas to purchase," Dassault's Chief Executive Eric Trapper said.

Dassault Aviation, the French-German-Spanish aerospace group EADS and Italy's Finmeccanica issued a joint statement on the eve of last month's Paris Airshow offering to cooperate on medium altitude-long endurance (MALE) surveillance drones.

Britain's BAE Systems co-operates separately with Dassault on drones, and analysts say piecemeal efforts to co-operate in unmanned technology have yielded little progress.

France has announced plans to buy a dozen drones from the United States to support operations in Mali.

In a results statement coinciding with the start of a visit to India by French Defence Minister Jean-Yves Le Drian, Dassault's Trappier also said it was important to complete a long-awaited deal to sell 126 Rafale warplanes to India.

India's defence ministry said Defence Minister A.K. Antony would meet Le Drian on Friday but declined to discuss details.

India picked the Rafale for exclusive negotiations in January 2012 after a hotly contested bidding war between rival suppliers. But it has yet to finalize the $15 billion deal, one of the most sought-after in the global arms export industry.

Sources familiar with the matter have blamed the delay on differences over the industrial role of India's state-run Hindustan Aeronautics. But an Indian government source said differences had abated and that a deal could be signed soon.

Dassault Aviation reported lower first-half profits and revenues on reduced Falcon business jet deliveries and higher research and development costs, but predicted a pick-up in revenue in the second half.

First-half operating profit excluding its stake in electronics firm Thales fell 23 percent to 187 million euros on revenues which fell 5 percent to 1.826 billion euros.

Dassault took in 1.41 billion euros of new orders.

It predicted a rise in full-year Falcon deliveries to 70 units compared with 66 in 2012, and higher full-year revenues. (Reporting by Cyril Altmeyer, Anurag Kotoky, Tim Hepher; editing by Mark John)

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