As David Cameron’s now infamous veto of a treaty for greater fiscal integration in the European Union, the leaders of France and Germany bonded closer, overcoming to a large extent their difficult personal chemistry.

Thousands of kilometers away in India, this realignment coincided with the victory of the French-made Dassault Rafale in India’s Multi Role Medium Combat Aircraft (MMRCA) contest. The emerging schism which the tantrum was symptomatic of, had already begun to play out in India.

The MMRCA contest has been India’s biggest fighter contest of this century, worth about $20 billion or $60 billion if spread out over the next thirty years. It coincided with a similar quest for a new fighter jet in Japan.

The Eurofighter also participated in both contests. Italy and Spain, junior partners in the joint fighter project, took a backseat while Germany took the lead in India (unusually, given that the British are much more familiar with it) while the British were given charge of the Japanese campaign (again, unusual, since the Germans consider themselves to have penetrated the Japanese psyche more).

The otherwise successful plane faltered in both contests. The loss in Japan was understandable given that it was up against a supposedly superior plane that is a full generation ahead. The loss in India was galling however given that the Rafale is considered the lowest performing of all modern western warplanes.

Expectedly, the British press went into a tizzy, demanding a revoking of the $1 billion worth of aid India received while The Sunday Times ran an investigative article on how the competition was “fixed” by some “shady” Frenchmen.

That the process was tainted and corrupt is undeniable. All Indian defense acquisitions are. What is surprising is the German disinterest in winning this contact and the way in which Germany appears to be maneuvering at the highest levels to scuttle any British move to appeal the Indian decision.

One thing everyone in Delhi seems clear about is that the Eurofighter was the only horse in the race without state support. The Swedes, Russians and Americans all backed their ponies to the hilt, while the French by all accounts resorted to a massive campaign of electronic espionage and presumably bribery to win.

Indeed, the French were so exasperated with what they saw as Dassault’s negotiating incompetence that they went to great lengths to exclude it entirely from the Indian campaign.

Berlin, on the other hand, did exactly nothing. Several times in the contest the British reportedly expressed serious reservations about the way Germany was sleeping on the job but apparently to no avail.

If there was one piece of critical analysis missing from The Sunday Times‘s reporting, it was why Germany would be so reluctant to win $60 billion worth of business.

Once the Rafale’s victory was sealed, things started getting a lot murkier. While the British were crying themselves hoarse, the standard German line paraphrased was, “India is a big market with several opportunities, this is one deal that didn’t go our way — c’est la vie.” This in spite of several indicators being dug by the Indian press, institutions and even bureaucrats of the contest being manipulated.

The standard claim is that Germany is “hiring” — i.e., the jobs lost on the Eurofighter production line will be absorbed into other sectors of German industry.

Britain is not hiring though nor is France and the insinuations floating around are that this deal is a secret bailout package for the French in addition to the considerable sums of money Germany has to spend to finance European deficit spending.

The severe conflict of interest and possibilities for European collusion in this contest are reflected in the ownership. The European Aeronautic Defence and Space Company owns 46 percent of the Eurofighter Consortium and 46.3 percent of Dassault Aviation which produces the Rafale. This .3 percent difference means a higher cut for EADS in the profit share should the Rafale win. Its French boss, Louis Gallois, went on the record after the Eurofighter loss claiming as much.

Curiously, coinciding with the timing of the Indian loss was news that Cassidian, EADS’s subsidiary that had led the Indian campaign, was to move its headquarters from Munich to Toulouse — ostensibly to be nearer to Airbus.

The German reaction to all this? Silence. High level political pressure when Nicolas was coochie cooing Angela? Perhaps. Serge Dassault, the president of Dassault Aviation, is a close ally and major funder of President Sarkozy in addition to being a member of the French conservative party. Moreover, he owns the influential newspaper Le Figaro.

Given all this shadow play, it seems Goethe got it right. Licht! Mehr Licht!