VeeraBahadur
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NEW DELHI, JULY 14, 2015: Tata, L&T and Punj Lloyd are competing to set up an assembly line for the M777 ultra light howitzer (ULH) in India in partnership with BAE Systems. The winner is expected to be decided by the end of July 2015. Notably, BAE Systems' former partner, Mahindra Defense Land Systems, is also part of the competition.
BAE Systems has offered to set up the assembly, integration and testing (AIT) facility for the M777 in India on the lines of its facility in Hattiesburg, Mississippi, in the U.S., as part of its new offsets plan, which was approved by the Defense Acquisition Council (DAC) headed by Defense Minister Manohar Parrikar on May 13, 2015.
BAE Systems will not invest equity in the AIT facility. "We are searching for one Indian partner to set up an assembly, integration and testing facility in India. We have issued a tender for this partnership and we have gone through a process of assessing the companies interested in tying up for this facility. We will decide on the partner by the end of this month," BAE Systems India Managing Director John Brosnan told Arming India in New Delhi on July 1, 2015.
Forty other Indian partners have been identified by BAE Systems to discharge offsets obligations. MoUs have been signed with these partners.
The assembly line in India could well be used for exports after the fulfillment of the Indian order, as first reported by Arming India in January 2015.
The Indian AIT will be at the heart of the global supply chain for the M777. "India will now become part of the M777 global supply chain involving facilities in the U.S., Europe and South Africa. We want to export the gun out of India at some stage in the future," confirmed Brosnan.
The stalemated process to acquire 145 M777 guns for the Indian Army received new momentum after the approval of a new plan by BAE Systems to discharge 30 per cent offsets. This put the deal back on the table. The earlier offsets plan was declared non-compliant by the Ministry of Defense (MoD).
In just over a month after the DAC go-ahead, the MoD has re-started the procurement process. It has written to the U.S. Administration, asking it to re-state availability and price in a renewed Letter of Acceptance (LOA), again reported first by Arming India.
The restated offer will put the price in the $750 million to $885 million band, as has been indicated in the U.S. Congressional approval, which permits the sale of this gun to India till 2018.
BAE Systems has offered to set up the assembly, integration and testing (AIT) facility for the M777 in India on the lines of its facility in Hattiesburg, Mississippi, in the U.S., as part of its new offsets plan, which was approved by the Defense Acquisition Council (DAC) headed by Defense Minister Manohar Parrikar on May 13, 2015.
BAE Systems will not invest equity in the AIT facility. "We are searching for one Indian partner to set up an assembly, integration and testing facility in India. We have issued a tender for this partnership and we have gone through a process of assessing the companies interested in tying up for this facility. We will decide on the partner by the end of this month," BAE Systems India Managing Director John Brosnan told Arming India in New Delhi on July 1, 2015.
Forty other Indian partners have been identified by BAE Systems to discharge offsets obligations. MoUs have been signed with these partners.
The assembly line in India could well be used for exports after the fulfillment of the Indian order, as first reported by Arming India in January 2015.
The Indian AIT will be at the heart of the global supply chain for the M777. "India will now become part of the M777 global supply chain involving facilities in the U.S., Europe and South Africa. We want to export the gun out of India at some stage in the future," confirmed Brosnan.
The stalemated process to acquire 145 M777 guns for the Indian Army received new momentum after the approval of a new plan by BAE Systems to discharge 30 per cent offsets. This put the deal back on the table. The earlier offsets plan was declared non-compliant by the Ministry of Defense (MoD).
In just over a month after the DAC go-ahead, the MoD has re-started the procurement process. It has written to the U.S. Administration, asking it to re-state availability and price in a renewed Letter of Acceptance (LOA), again reported first by Arming India.
The restated offer will put the price in the $750 million to $885 million band, as has been indicated in the U.S. Congressional approval, which permits the sale of this gun to India till 2018.