NEW DELHI — India is moving forward with a $1 billion purchase of Spike anti-tank guided missiles from Rafael Advanced Defense Systems of Israel, overlooking the single-vendor situation in the deal, according to an Indian Ministry of Defence official.
The MoD postponed the purchase because it would be made with a single vendor, which has been discouraged multiple times under India's defense procurement policy, according to news organization IHS Jane's 360.
Apart from the single-vendor situation, the Spike deal since 2014 has also been deferred over costs, which has now been cleared, the MoD official said.
"MoD has now forwarded the deal to the Cabinet Committee of Security, which is likely to clear the same (deal) this week" on March 29, the official said. "The deal could then be signed after next month."
The Cabinet Committee of Security, which is headed by the prime minister and which deals with weapons purchases, is the highest body in the Indian government.
The push to buy the Spike comes ahead of a proposed visit by Indian Prime Minister Narendra Modi to Israel in June this year.
Under the deal, the Indian Army will procure 321 Spike ATGM launchers, 8,356 missiles, 15 training simulators and associated accessories from Rafael on a single-vendor basis.
"The single-vendor situation has arisen as the other option, American Javelin, was found to be too expensive and has been accepted as a fait accompli keeping in view the needs of the Indian Army for third-generation ATGM," said Rahul Bhonsle, a defense analyst and retired Indian Army brigadier.
The deal also includes an option to build another 1,500 launcher systems and about 30,000 additional missiles under technology transfer to state-owned Bharat Dynamics Limited. The first delivery of the Spike ATGM is likely to being 58 to 60 months after the deal is signed.
The Army currently faces a shortage of ATGMs and has a total requirement of 40,000 ATGMs in the next 20 years. In the meantime, it is using second-generation Milan missiles (with a 2-kilometer range) and Konkurs missiles (with a 4-kilometer range) produced by BDL under license from French and Russian companies, respectively.
"For long, Indian Army and aviation has been held hostage to old-generation ATGMs mostly procured from Russia and Europe. These ATGMs are fully wire-guided ATGMs. Even Spike is not a fully fire-and-forget missile, as there is wire guidance in Spike," an Indian Army official said.
Making a case for global competition for the purchase of a new-generation ATGM, the Army official said: "The Army should prepare operational qualitative requirements for ATGMs and open up the case for multi-vendor competition under a Buy & Make (India) category and commitment for transfer of technology."
The Indian Army wants to equip all its 382 infantry battalions and 44 mechanized infantry units with new-generation ATGMs and replace the second-generation French-made Milan ATGMs.
The purchase of the third-generation ATGMs is in addition to the homegrown Nag ATGM still under development. An ongoing proposal to jointly produce American Javelin ATGMs has been under consideration for more than three years and is now awaiting fresh negotiations under the Trump administration, according to the MoD official.