Indian media report the country’s defense ministry has canceled a $500 million deal with Rafael Advanced Defense Systems to purchase Spike anti-tank guided missiles (ATGM).
The mammoth deal was finalized during the historic visit to Israel in July 2017 by India’s Prime Minister Narendra Modi. 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 final contract, seen as another sign of growing Indo-Israeli military cooperation, was to be signed after financial talks concluded last year.
But at the ninth hour, India’s defense ministry instead decided this month to cancel the deal in deference to indigenous production.
“DRDO has successfully produced the Nag and Anamika ATGMs. It is confident about providing the Army with an MPATGM of 3rd generation missile technology, at par with Spike, within three to four years. It won’t also need any transfer of technology,” sources said, according to The Indian Express.
India’s Army Headquarters was not pleased with the decision, however, saying the decision was a setback to modernizing the force. In correspondence with the ministry, army officials reportedly underlined “the operational urgency of the equipment” and argued the Spike “gives a major capability impetus to troops deployed on the Line of Control, especially in the current operational scenario.”
Rafael had entered a joint venture with Kalyani Group to produce missiles in India in anticipation of the contract, inaugurating a missile sub-systems manufacturing facility in August near Hyderabad.
The Spike system, manufactured and marketed by Rafael, consists of missiles suited for several platforms, multiple ranges and a variety of targets. Spike is a fourth generation man-portable fire-and-forget anti-tank guided missile with tandem-charged HEAT warhead. The Spike missile can be also used on board a ship, and installed in helicopters and other aircraft.