17 Apr 13. The monopoly of foreign companies in India’s future artillery gun projects has been broken. Now domestic defence companies will be allowed to compete in future 155mm/52 calibre mountain gun tender as the Defence Acquisition Council (DAC) has agreed to a demand of the domestic private sector companies to make necessary changes in law so that they are also allowed to compete in the tender. A number of overseas companies have hurriedly joined hands with domestic companies to manufacture 155mm guns.
Elbit of Israel has tied up with Bharat Forge, Samsung of South Korea with Larsen &Toubro and Tata Power SED has already displayed its 155mm/52 caliber mountain gun which it claims has been produced in house. Sources however, said it is a Denel gun which has been incorporated by Tata Power SED with in-house features. Denel of South Africa has already been blacklisted to do business in India in 2005 on alleged charges of corruption. Singapore Technologies which was running for the Light Howitzer was blacklisted in 2008.
L&T and Samsung meanwhile are preparing to make variety of guns including tracked guns here. The two companies have inked an agreement to jointly develop a Track gun which is already under development said sources in L&T. While no official word is available on how much will Samsung contribute in the gun, source say majority of the components are from South Korea and other overseas sources.
With domestic private sector defence companies claiming to produce in-house guns, the Ministry of Defence has been forced to agree to their demand that they be allowed to compete in all international tenders for artillery, estimated to be over $4.5 billion. Indian Army has failed to buy a single Howitzer gun since 1986 as several tenders landed in cancellation, mostly on grounds of blacklisted on one of the runners.
The Ministry of Defence now wants to involve the domestic defense companies so that it will be less exposed to charges of corruption from outside competitors who are known to be aggressively out beating their competitors in several weapon tenders by levelling charges of corruption. This situation is unlikely to happen when the domestic companies will compete, said a senior official of the Ministry of Defence.
A Ministry of Defence official said, “Under the new policy being finalized Preference will be given to indigenous design, development and manufacture of defense equipment. Therefore, wherever the required arms, ammunition and equipment are possible to be made by the Indian industry within the timelines required by the Services, the procurement will be made from indigenous sources.”
Whenever the Indian industry is not in a position to make and deliver the equipment in the requisite time frame, procurement from foreign sources would be resorted to.
In the near future the first global tender to be floated in which domestic companies will be allowed is the procurement of mountain guns. The total rewquireme4nt of mountain guns is 814 estimated to be around $1.5 billion
The current trend by domestic defence companies to forge alliances with overseas partners will end up producing re-painted weapons and equipment here as the domestic defense market is not mature enough commented, a senior serving officer of the Indian Army.