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05 Jul 11. India is on the brink of starting its prestigious “Indian Industry only” competition initiated by the Defence Ministry for the indigenous development of Future Infantry Combat Vehicles (FICVs). By the end of August, four Indian companies will be submitting their bids for developing these high-tech systems for the Indian Army.
The FICV project may become the most high-priced defence contract in India and the bidders include the Tata Group, the Mahindra Group and Larsen & Toubro (L&T) from the private sector and the state-owned Ordnance Factory Board (OFB). Estimates for the price tag of developing and manufacturing 2,600 FICVs run into Rs. 50,000 crores, according to sources. The FICV will replace the aging Russian BMP II vehicles with the Indian Army.

After careful analysis, the Defence Ministry has handed out an Expression of Interest (EoI) to the above-mentioned four companies with a list of requirements posed by the Indian Army from the FICV.

By August 25, each competitor will detail their proposal for developing the FICV, the key project milestones, the estimated capital expenditure, the technology they will include and how that will be developed or purchased and the minimum order to make it a financially viable production line. After response evaluation, two contractors will be picked to develop their respective FICV prototypes. After the field trials, the Indian Army will pick the one of its choice.

However, the Defence Ministry has mandated that there will not be a single winner. With the intention of having two production lines for the FICV, the Defence Ministry has indicated that the winner will be given 65-70 per cent of the order and the runner-up will build 30-35 per cent of the army’s requirement of FICVs, provided that the company agrees to build the winning design at the same cost as the winner.

The FICV is not just a conventional armoured vehicle for transporting soldiers but features advanced technologies and multidisciplinary integration. As per the EoI, the FICV will be operated by three crewmembers and carry seven additional soldiers with combat loads.
The FICV will facilitate protection from bullets fired by 14.5-millimetre calibre weapons. It must be amphibious and it must be air-transportable, which would imply a maximum weight of 18-20 tonnes. Besides that, it must have a cannon and be capable of firing anti-tank missiles.

Up until now, only the state-owned Defence Research and Development Organisation (DRDO) and the Ordnance Factory Board (OFB) have the experience and know-how of the technology needed for the development and manufacturing of the FICV. Hence, they will be supporting the private players for the FICV project. For instance, the OFB factory at Medak can be used on a government-owned-company-operated basis for developing the FICV instead of setting up a new facility.

The Indian Defence Ministry will be funding 80 per cent of the cost of developing the FICV, while the selected contractor will pay the rest 20 per cent. An indigenous content of at least 50 per cent has been mandated. The FICV will take roughly eight years for development.

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