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The defence acquisitions council (DAC) headed by minister Manohar Parrikar tonight cleared a China-frontier-specific deal to procure howitzers from the US through a government-to-government agreement even as Prime Minister Narendra Modi was leaving for Xian and Beijing.
The clearance today is essentially a return to the deal as envisaged more than 12 years ago.
The M777 ultra-light howitzers made by BAe Land Systems in the US is estimated to cost Rs 2,900 crore for 145 pieces. The negotiations were stuck for, among other reasons, a hike in the price of the cannons that can be transported by helicopters to the mountains.
The contract negotiations will now be restarted.
In a political call, the DAC also decided to give the green signal to procure 56 transport aircraft from a joint venture between the Tatas and Airbus Industrie. The Tata-Airbus entity had emerged as the only bidder that offered to replace the ageing Avros of the Indian Air Force. The procurement is estimated to cost Rs 11,930 crore.
Sixteen aircraft will be purchased off the shelf and 40 will have to be made in India.
Other major procurements approved by the DAC include:
♦ More than 200 Kamov 228 light-utility helicopters for the army and the navy through a "Make in India" scheme. Russia had conveyed during President Vladimir Putin's visit last December to transfer technology. An Indian partner for the programme is yet to be picked;
♦ Two Boeing 777-300ER from Air India to transport the Prime Minister and other VIPs at no additional cost;
♦ Brahmos missile systems for six warships for about Rs 2,700 crore;
♦ A committee to oversee negotiations with France for 36 Rafale fighter jets.
The total worth of approvals by the DAC today is about Rs 30,000 crore. This is an estimated value, not a contracted amount. The DAC has given approval for contract negotiations.
The DAC also cleared Rs 30 crore as "consultancy fees" for an aircraft carrier to be made in India. India and the US are in negotiations for aircraft launch and flight-deck management technology from carriers.
The deal cleared today while PM Modi is in china.
