With gun assembly plant, defence gets a ‘Make in India’ project

[Bang Galore]

The ministry had given BAE Systems, the manufacturer of M777 artillery guns, till October 31 to submit its offset agreements with local companies


In what is likely to be the first major ‘Make in India’ project in defence, the defence ministry is about to sign a deal with the US government to assemble 145 BAE Systems M777 155mm/39mm calibre lightweight howitzers in India.

Estimated to be worth $700 million, the deal is being done through the Foreign Military Sales route and a draft Letter of Acceptance (LoA) has been agreed upon between the Pentagon and the defence ministry.

The ministry had given BAE Systems, the manufacturer of M777 artillery guns, till October 31 to submit its offset agreements with local companies.

This includes the Indian company to whom BAE Systems will transfer its M777 assembly, integration and test (AIT) facilities from Hattiesburg, Mississippi (US).

BAE Systems has entered into MoUs with over 40 Indian companies to fulfill the offset requirement, which are 30 per cent of the contract value. The Indian partner for the AIT facilities, where 70 per cent of M777 gun’s assembly will be completed, is yet to be announced.

“Several companies have the capabilities to perform such work and BAE Systems is evaluating proposals. Establishing an AIT facility in India will lay a foundation to expand future work content in India, potentially leading to M777s for India and for possible export,” Mark Simpkins, Vice-President & General Manager-India, BAE Systems, told The Indian Express.

The LoA is expected to be inked later this year, nearly eight years after the M777 purchase was mooted during the UPA-1 regime. The Army hopes to get the first guns within six months of the signing of the LOA, so it can work out the Range Table Development and start training the artillery units

With gun assembly plant, defence gets a ‘Make in India’ project | The Indian Express

 

[dadeechi]

The ministry had given BAE Systems, the manufacturer of M777 artillery guns, till October 31 to submit its offset agreements with local companies


In what is likely to be the first major ‘Make in India’ project in defence, the defence ministry is about to sign a deal with the US government to assemble 145 BAE Systems M777 155mm/39mm calibre lightweight howitzers in India.

Estimated to be worth $700 million, the deal is being done through the Foreign Military Sales route and a draft Letter of Acceptance (LoA) has been agreed upon between the Pentagon and the defence ministry.

The ministry had given BAE Systems, the manufacturer of M777 artillery guns, till October 31 to submit its offset agreements with local companies.

This includes the Indian company to whom BAE Systems will transfer its M777 assembly, integration and test (AIT) facilities from Hattiesburg, Mississippi (US).

BAE Systems has entered into MoUs with over 40 Indian companies to fulfill the offset requirement, which are 30 per cent of the contract value. The Indian partner for the AIT facilities, where 70 per cent of M777 gun’s assembly will be completed, is yet to be announced.

“Several companies have the capabilities to perform such work and BAE Systems is evaluating proposals. Establishing an AIT facility in India will lay a foundation to expand future work content in India, potentially leading to M777s for India and for possible export,” Mark Simpkins, Vice-President & General Manager-India, BAE Systems, told The Indian Express.

The LoA is expected to be inked later this year, nearly eight years after the M777 purchase was mooted during the UPA-1 regime. The Army hopes to get the first guns within six months of the signing of the LOA, so it can work out the Range Table Development and start training the artillery units

With gun assembly plant, defence gets a ‘Make in India’ project | The Indian Express

Does it mean October 31, 2016 ?

 

[Bang Galore]

Does it mean October 31, 2016 ?

2015. Must have been completed, hence the likely order.

 

[dadeechi]

2015. Must have been completed, hence the likely order.

I was hoping that something would be announced during the UK visit but nothing came out. Since it is going to be an FMS deal it should be faster. US entities are great when it comes to delivery on schedule.

 

[Manindra]

When Gun barrel technology would not be transferred, then its is just old under licence assembly

 

[Water Car Engineer]

When Gun barrel technology would not be transferred, then its is just old under licence assembly

Essentially, never the less wiith a private firm building a plant under the aegis of BAE, India has another piece of infrastructure and a company that can fabricate and test much of any artillery piece. Which the private firm can later leverage in their future gun programs, or DRDO can leverage in their artillery programs.

 

[surya kiran]

Gun barrel technology

That would require metallurgical expertise on our end also. This is one of the areas we really need to improve. I wish this area was given priority in the Indian system.

Does it mean October 31, 2016 ?

No. 2015. This process is already over. Now, its the signing of the agreement.

The upside, if this thing is going to be in India, then future orders are almost a given. I think, MP is doing a smart thing, by laying down the foundation of the equipment manufacturers who will build our weaponry for the future mountain corps. Smart thinking.

 

[Echo_419]

Essentially, never the less wiith a private firm building a plant under the aegis of BAE, India has another piece of infrastructure and a company that can fabricate and test much of any artillery piece. Which the private firm can later leverage in their future gun programs, or DRDO can leverage in their artillery programs.

Agree an ecosystem is being created

 

[Manindra]

Essentially, never the less wiith a private firm building a plant under the aegis of BAE, India has another piece of infrastructure and a company that can fabricate and test much of any artillery piece. Which the private firm can later leverage in their future gun programs, or DRDO can leverage in their artillery programs.

That would require metallurgical expertise on our end also. This is one of the areas we really need to improve. I wish this area was given priority in the Indian system.

Apart from Gun Barrel (quite high quality) we have already all infrastructure, so its not justifiable to just kit assembly a gun which cost you more than imported due to local production line expenses.

 

[Bang Galore]

That would require metallurgical expertise on our end also. This is one of the areas we really need to improve. I wish this area was given priority in the Indian system..

Not really. For a company like Bharat Forge, it shouldn't be too difficult an ask.

 

[Great Sachin]

This called real investment where our people get jobs, skill set, industry growth......jai ho Modi

 

[Abingdonboy]

Apart from Gun Barrel (quite high quality) we have already all infrastructure, so its not justifiable to just kit assembly a gun which cost you more than imported due to local production line expenses.

Except, there is no M777 production line anywhere in the world anymore. As a result this route has to be taken- the moment the M777 production line closed if India really wanted these guns it was going to have to pay a premium- either to make them at home or pay to have the production line restarted. This way at least some jobs will be created in India and a world class production unit created in India that may be used to service third party export orders in the future.

The need for the M777 is still there so something had to be done...

 

[Manindra]

Except, there is no M777 production line anywhere in the world anymore. As a result this route has to be taken- the moment the M777 production line closed if India really wanted these guns it was going to have to pay a premium- either to make them at home or pay to have the production line restarted. This way at least some jobs will be created in India and a world class production unit created in India that may be used to service third party export orders in the future.

The need for the M777 is still there so something had to be done...

Instead of such long explanation tell me a simple answer.
Would they transfer Gun Barrel Technology
What we gain important technology in it ?
Tyres, FCS, Sights ? Which we already posses.
30% offset would already applied if we import them directly & it would be cheaper than local assembly.

 

[Abingdonboy]

Instead of such long explanation tell me a simple answer.
Would they transfer Gun Barrel Technology
What we gain important technology in it ?
Tyres, FCS, Sights ? Which we already posses.
30% offset would already applied if we import them directly & it would be cheaper than local assembly.

The last line is what I was addressing- where are you going to import the M777 from when the production line closed years ago?

Forget about the ToT, this deal is not about that- regardless of what any "defence" journalists tries to spin.


This deal is about getting the M777, there are only 2 options available now:

1) Pay BAE a fee to reopen their line abroad
2) Pay a similar fee to have the production line set up in India.

At least the latter will provide jobs and capacity augmentation in India with the possibility of orders for third party M777 customers being serviced from BAE's India plant.


The way I see it is the IA needs the M777 (no questions about it), there is no alternative (anywhere- forget about Indian ULHs that are nothing but display models at this point) to the M777 so one of the two option stated above has to take place and option 2 seems to be, on balance, more desirable for India.

 

[Manindra]

The last line is what I was addressing- where are you going to import the M777 from when the production line closed years ago?

Forget about the ToT, this deal is not about that- regardless of what any "defence" journalists tries to spin.


This deal is about getting the M777, there are only 2 options available now:

1) Pay BAE a fee to reopen their line abroad
2) Pay a similar fee to have the production line set up in India.

At least the latter will provide jobs and capacity augmentation in India with the possibility of orders for third party M777 customers being serviced from BAE's India plant.


The way I see it is the IA needs the M777 (no questions about it), there is no alternative (anywhere- forget about Indian ULHs that are nothing but display models at this point) to the M777 so one of the two option stated above has to take place and option 2 seems to be, on balance, more desirable for India.

Alternatives are available.

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