From submarines to helicopter carriers: How the US has pummelled France's defence industry

The United States has come under fire from France after Paris was pushed aside from a historic defence export contract to supply Australia with submarines.

On Thursday, Australia decided to dump its contract with France to build diesel-electric submarines in favour of US-made nuclear-powered submarines as part of the new AUKUS alliance.

France has accused President Joe Biden of stabbing it in the back and acting like his predecessor Donald Trump.

"This brutal, unilateral and unpredictable decision reminds me a lot of what Mr Trump used to do," Foreign Minister Jean-Yves Le Drian told franceinfo radio. "I am angry and bitter. This isn't done between allies."

This is not the first time that the US has struck a blow to French defence deals and it could lead to a bump in ties between the two allies.

$50 billion submarine deal

France's Naval Group, partly owned by the State, had been chosen to build 12 conventionally powered submarines to Australia, based on France's Barracuda nuclear-powered subs in development.

The contract was worth around Aus$50 billion (31 billion euros, $36.5 billion) when announced in 2016.

But US president Joe Biden and the prime ministers of Australia and Britain announced a new defence pact that would see Canberra get a nuclear-powered submarine fleet, a privilege reserved for few American allies.

The scrapping of the deal came as a surprise to the French, who just two weeks ago had reconfirmed the deal.

The Guardian reported that the nixing of the deal wasn't just a setback in financial terms, but also to French diplomacy, which had worked for years to secure the partnership with Australia and strengthen its strategic presence in the Indo-Pacific region.

Asked by journalists if Paris had been “duped” by Washington over what Le Drian once called a “contract of the century” for France’s naval yards, the minister replied: “Your analysis of the situation is more or less correct.”

France was also steaming at the ears over Australia's about-face, with French defence minister, Florence Parly calling it “very bad news with regards to keeping one’s word”.

“In terms of geopolitics and international relations, it’s serious,” she told RFI radio on Thursday.

French relations with US, which soured during Donald Trump's presidency, is bound to nosedive over this development and consequences are already being felt.

The French embassy in Washington said it was cancelling a gala event related to French-US ties on Friday following the day's events.

France also recalled its ambassadors to the United States and Australia for consultations, an unprecedented step

Mistral deal with Russia

In 2010, then Russian president Dmitry Medvedev approved the purchase of two DCNS Mistral-class amphibious assault-class ships from France at a total value of €1.2 billion.

The first, Vladivostok, was due to be delivered in October 2014, with Sevastopol expected to join the fleet in 2015. Russia then had the option to build two more domestically.

Mistral class are of amphibious assault type, and are also known as helicopter carriers. A Mistral-class ship, jointly built by France's Naval Group and STX Europe, is capable of transporting and deploying 16 Tiger helicopters, four landing barges, up to 70 vehicles including 13 Leclerc tanks, or a 40-strong Leclerc tank battalion, and 450 soldiers.

On 25 January 2011, the final agreement between Russia and France was signed.

However, six US Republican senators, including now-deceased John McCain, complained to the French ambassador in Washington about the proposed sale.

While the US government stated it was concerned about the sale, they said little could be done to block it.

In 2014, the European Union and the United States imposed an arms embargo on Moscow for its continued backing for separatists in eastern Ukraine.

Reacting to the curbs placed on Russia, France announced that it would halt the delivery of the state-of-the-art ships.

At the time, a statement from the Elysée Palace read, "The conditions under which France could authorise the delivery of the first helicopter carrier are not in place."

Eventually, in November of the same year, France stated that it would not hand over the warships to Russia.

In retaliation, Russia placed an ultimatum to France: Deliver the two ships or refund the $1.53 billion purchase price.

Finally, after much deliberations, it was announced in August 2015 that Paris would fully refund Russia for the warships.

With that, the Kremlin had said that it considered the dispute to be fully resolved.

The deal was an embarrassment for then French president Francois Hollande.

Last word in

Russia didn't lose an opportunity to have the last word on the issue of the submarine deal with Australia and made sure to rub salt in France's wounds.

“Are only the knives that you feel behind your own back a problem?”

Maria Zakharova, spokesperson for the Russian foreign ministry, in reacting to France's Le Drian's declaration ('I am angry today, with a lot of bitterness, that is not done between allies"), said: "Why this anger and this bitterness? The breach of contracts seems, for France, to be a usual thing. In 2015, Paris cancelled a contract with Russia on two Mistral helicopter carriers. “Are only the knives that you feel behind your own back a problem?”

With inputs from agencies