The Indian Express reported on Monday that India cancelled the $500 million deal with Rafael in favor of India's Defence Research and Development Organisation (DRDO) indigenously developing and producing a similar weapon. It was approved in 2014 by the Defense Aquisition Council (DAC), which is responsible for purchases for the Indian Army, but negotiations were stuck over disagreements on cost and technology transfer.
The deal, which was seen a proof of increasing defence cooperation between India and Israel, was expected to be signed soon after price negotiations with Rafael Advanced Defence Systems of Israel were completed past year.
But at the ninth hour, India's defense ministry instead decided this month to cancel the deal in deference to indigenous production.
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Indian media networks reported today (Monday) that India's Ministry of Defense has made a decision to cancel a major arms deal with Israeli company Rafael Advanced Defense Systems- a deal estimated to be worth about half a billion dollars. It bears adding that the Indian development authority has created anti-tank guided missiles before, the Nag and Anamika.
Indian military sources told the website that DRDO had already produced a few varieties of anti-tank guided missiles and was "confident" that it could produce one on par with the Israeli Spike. "Rafael is also willing to offer solutions through the Joint Venture even for the ongoing "Buy Global" programs where it is now competing, in line with "Make in India" initiatives of the Indian government", Reliance added.
Reports state that the decision to retract the Request for Proposal (RFP) will prove to be a setback to the Army's modernisation programme. Israel's Rafael Advanced Defense Systems- that had announced a joint venture with an Indian company in anticipation of the deal- manufactures Spike ATGMs.
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Meanwhile, in several letters to the Defence Ministry, the Army highlighted it's urgency to procure operational equipment, arguing that the Spike ATGM will boost the capability of troops deployed on the Line of Control.
An Israeli soldier displays a Spike anti-tank missile launcher.
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