NEW DELHI: Leading gun-maker BAE Systems today announced selection of Mahindra as its India partner for the nearly USD 700 million deal for the supply of 145 M777 howitzers to the Indian army, the first new artillery guns after the Bofors scandal.
The gun, with a strike range of 25 kms, will form the backbone of the Mountain Strike Corps, being raised by the government for the mountainous borders with China.
It is a 155mm titanium-based Ultra-Light Howitzer (ULH) and can be airlifted by helicopters with ease to distant mountainous military posts.
The gun deal would be through Foreign Military Sales (FMS) but the "spares, maintenance and ammunition will be operated through Indian systems", defence sources said.
"BAE Systems has down-selected Mahindra as its business partner for the proposed in-country Assembly, Integration & Test (AIT) facility for the M777 Ultra Lightweight Howitzer," BAE, a British company with a subsidiary in the US, said in a statement.
The gun is owned by the US government and hence the deal has to be through an FMS route.
India and the United States are in discussion for supply of 145 M777A2 LW155 howitzers for the Indian Army, it said.
"BAE Systems looks forward to working with Mahindra in the coming weeks to finalize details of this AIT facility and to negotiate the terms of its contractual arrangement," the company said.
Last year, BAE developed and submitted a US government- supported proposal offering a higher degree of indigenisation on the M777 weapon system.
The highlight of this is the commitment to establish AIT capabilities in India in partnership with a domestic Indian company.
"The selection follows a detailed assessment of Mahindra's ability to fulfil the requirements and provide the best value to the M777 India programme, and in the future, grow its capability as a strategic partner for BAE Systems in India," it said.
Joe Senftle, Vice President and General Manager, Weapon Systems, BAE Systems said that as a founding partner of defence manufacturing in India, BAE Systems "is pleased to partner with Mahindra".
The facility is a fundamental part of the M777 production line.
After the Bofors controversy in 1986, no new gun has been procured by the Army for its artillery.
A domestic Assembly, Integration and Test facility will enable the Indian Army to access maintenance, spares and support for the M777 locally.
"We will continue to support the two Governments to progress to contract agreement so that we may begin the process of 'Make in India' for M777," Senftle said.
On its part, Mahindra said M777 will give the army a much needed operational advantage and an access to state-of-the-art technology.
"Mahindra M777 facility will also ensure that the life cycle support is available locally thereby enhancing operational availability of the guns," SP Shukla, Group President, Mahindra Defence & Aerospace, said.