The long delay by India of an official confirmation of the purchase of American-made M-145 lightweight towed howitzers 777 can lead to a significant increase in the cost of implementing the program.
It is reported by "Janes Defense Weekly", citing industry sources.
According to sources, the inability of the Indian Ministry of Defense to confirm an order for the supply of M-777 under the program "Foreign military sales" led to an increase in cost from 647 million dollars as of January 2010 year (according to DSCA notifications) to 694 million dollars as of August 2013 of the year.
This information was confirmed by the Minister of Defense of India A.K. Anthony in response to the request of parliamentarians, saying that the US government responded to the request sent in November 2012 of the year by “a letter with a proposal and acceptance of a proposal” with a preliminary cost of $ 694 million.
An industry source said that the price increased to 694 million dollars is a “gesture” of DSCA, designed to support negotiations on the supply of M-777 open, otherwise the contract would be considered canceled and the process would have to start anew.
Military sources familiar with the program's progress reported that the cost increase was partly due to the need to provide compensation to BAE Systems for maintaining the M-777 assembly lines in the UK and the USA. For these purposes, from the end of 2012, the company was forced to send about 50 million dollars, since it has no other orders for the supply of M-777.
Sources say that if the Indian MoD will not be able to confirm the agreement by October 15, the assembly line will still be closed, and the resumption of production will require an increase in the cost of India for the new agreement by 37% - up to 885 million dollars. This will also delay the delivery of India’s howitzers, as re-certification of components will be required. M-777 large assemblies are manufactured in the UK. But, since the main customers of the howitzers are NE and USMC, guns are assembled at the BAE Systems enterprise in Hettisburg (Mississippi pieces). The American side notified the Indian MoD that the cost of M-777 would increase and the assembly lines would be closed if the contract was not signed soon, but did not receive an official response.
As stated by Jaynes 18 on September, a representative of BAE Systems, the governments of India and the United States continue negotiations.
Meanwhile, the production program for the Indian Army of the 155-mm FH-77B towed howitzers with a barrel length of 45 calibers is experiencing problems. In early August, the barrel of one of the guns exploded during trials in Rajasthan. The prototype was manufactured at the Office armory factories OFB (Ordnance Factory Board), which received the technology for the production of these guns in the framework of the contract signed with the Bofors company in 1987 for the purchase of 410 units. 155 mm FH-77B towed howitzers with a barrel length of 39 calibers. Previously, production did not start due to a corruption scandal, which involved politicians, representatives of the Ministry of Defense and the command of the Indian Armed Forces.
According to official sources, now the incident with the rupture of the trunk may delay the implementation of the program for the production of these howitzers for more than a year.