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New Delhi –The Indian Army has come under the scanner once again following the recent mysterious leaking of a classified report related to the field trial of the M777 ultra-light Howitzer that was concluded recently. The pages of the classified report that have leaked contain evidence that the M-777 howitzer had failed the field trials concluded in December 2010.

The company that now own Bofors, the BAE Systems of US, makes the ultra light Howitzer M777 which is to be procured through a Foreign Military Sales (FMS) route by India from the US. The acquisition is to be made through the government-to- government FMS route and is worth over $647 million for 10 regiments (160) guns. However, according to the leaked pages of the report, the Howitzer gun appears to have failed the recent trials on several parameters.

The Indian government will soon decide on penal action against an Israeli defense company blacklisted in connection with a graft case filed by the Central Bureau of Investigation (CBI) against a former Ordnance Factory Board (OFB) chief, the Indian Upper House of Parliament, the Rajya Sabha was informed Wednesday.

The CBI filed the case against Sudipto Ghosh, former director general of OFB, in May 2009.

Defense Minister Arackaparambil Kurian Antony, in a written reply, said his ministry has issued show cause notices to Israel Military Industries (IMI) last year, following which the company requested supporting documents on the charges against it, which were provided to it.

“A decision regarding the penal action will be taken after examining the reply of IMI and in consultation with the ministry of law and justice and the Central Vigilance Commission,” Antony said.

After examining the First Information Report (FIR) lodged by the CBI against Ghosh, the defense ministry, through an order May 28, 2009, decided to put on hold all contracts with companies named by the investigating agency in the graft case.

British arms major BAE Systems Thursday opted out of India’s tender for 1,580 towed artillery guns with the deadline for submitting the bids coming to an end, a company official said here.

The tender was issued on January 28 under the Indian Army’s Rs.20,000 crore (Rs.200 billion/$ 444.8 million) artillery guns modernization program that has been hit by the taint surrounding the purchase of the Bofors guns 24 years ago.

The firm has the FH-77B05 155-mm 52 caliber towed gun among its products that it could have offered, but will now not do so after a detailed assessment of the tender documents, the official said.

BAE Systems, however, is on the verge of signing a Rs. 2,900 crore contract for 145 M-777 ultra-light howitzers. This gun is manufactured by the company in the US and the sale will be under the Foreign Military Sales route of the US government.

The tender for the towed guns seems jinxed, with the defence ministry cancelling the March 2008 tender in July 2010 and issuing a fresh request for information after BAE’s competitor Singapore Technologies Kinetics had sought more time for bringing its gun iFH-2000 for the trials in India, citing a single vendor situation emerging due to that development then.

Indian Defence Online, New Delhi — After a spate of scrapped tenders and trials for the Indian Army’s artillery gun, defence public sector undertaking Bharat Earth Movers Limited (BEML) has announced that it is ready with the indigenous 155mm, 52-calibre wheeled gun.

BEML has been made the nodal processing agency and the Indian government has permitted BEML to invite global tenders for the 155mm guns and the proposed contract for over 1,000 guns, besides other ranges of artillery guns including Howitzers. The estimated worth of these contracts is 20,000 crore.

The Indian Army has been desperately short of artillery firepower and a long-range state-of-the-art gun has been due for two decades since the Bofors gun controversy in the 1980s. The Indian Army’s 180-odd artillery gun regiments, each having 18 guns, have not received any new weaponry since the Bofors gun was bought in the late 1980s.

The selection of a suitable 155 mm, 52-calibre towed howitzer to fill this gap began only in 2002, when the Defence Ministry began evaluating three guns from BAE Systems, Israeli firm Soltam and Denel of South Africa.

New Delhi– India’s new Defence Production Policy (DPP) which will take the domestic defence industry into the new era of self-reliance and indigenisation has been released this week. The draft of the new DPP was approved in December last year by the Defence Acquisition Council (DAC) headed by Defence Minister AK Anthony.

The draft DPP indicates that the Indian government has decided that preference will be given to indigenous design, development and manufacture of defence equipment. The new policy will apply to long-term needs such as equipment required over 10 years into the future and a robust defence industrial base will be developed for self-reliance. The industrial base will harness the potential of private sector for design, development and manufacture of defence equipment. In the case of strategic and critical technologies, the draft DPP stresses the need to be self-reliant.

The DPP 2011 also has a new offset policy that accepts a key request of foreign as well as Indian vendors in the aviation and homeland security sectors by expanding the existing list of products in the offset category to include internal security and civil aircraft.

New Delhi –The Indian private sector has finally been given an equal footing with state-run entities as the Indian government will allow private Indian shipyards to construct naval ships. The Defence Minister A K Antony has said that starting January 2011, state owned shipyards will have to compete with private ones for ship building contracts.

Hence, the Defence Acquisition Council (DAC) will no longer give any nominations to the defence shipyards for naval projects and they will have to compete with the private shipyards for the tenders. This major policy shift has been affected for the Indian Navy and will later be extended to acquisition by the Indian Army and Indian Air Force (IAF) as well.

The Indian Defence Ministry has also indicated the need for stronger indigenisation and cited that the “Buy Indian Make Indian’ will remain the major policy when it comes to procurement as this will augment a strong defence industrial base.

The current policy shift is a major impetus for private players who are in the shipbuilding business and will now be able to contest for building naval warships.

The matter of the blacklisting of Singapore Technologies by the Indian Ministry of Defense just gets curiouser and curiouser. The arms company has contradicted the basis of the report, tabled by the Comptroller and Auditor General (CAG) of India in Parliament, on the special audit it conducted at the request of the Ministry of Defense, into the facts and circumstances that gave rise to the corruption case against the former Director General of Ordnance Factories and Chairman of the Ordnance Factory Board (OFB), Sudipta Ghosh.

The arms company had been recommended for blacklisting by the Central Bureau of Investigation (CBI) in June last year, after Sudipta Ghosh was implicated in a corruption case. A decision to blacklist was held in abeyance last December to allow trials of artillery howitzers and other weapons systems to be conducted, subject to the investigations agency’s final report.

But in January the company claimed this was not the case and that it had not, in fact, been blacklisted.

The Comptroller and Auditor General (CAG) of India was asked by the Ministry of Defense, in June 2009, to conduct an audit into the facts and circumstances that gave rise to the criminal case against the former Director General of Ordnance Factories and Chairman of the Ordnance Factory Board (OFB), Sudipta Ghosh.

While submitting that the institution of the CAG was neither ‘empowered nor equipped’ to conduct inquiries of a forensic nature, the CAG nevertheless accepted the charge and submitted a report to Parliament last week, that testifies to the acts of omission and commission, based on incompetence, lack of foresight or mala fide intent, that led to the recommendation of a blacklist of companies.

The recommendation for blacklisting Singapore Technologies (ST) arose from the issue of the supply of Close Quarter Battle (CQB) Carbines to paramilitary forces under the Ministry of Home Affairs (MHA), India’s law enforcement and interior ministry.

ST was indirectly mentioned in the FIR (First Information Report) registered by the CBI (Central Bureau of Investigation) against Sudipta Ghosh and so the ‘transaction with STK was put on hold in June, 2009 by MOD.

The Indian Army has issued a Request For Information (RFI) for towed artillery guns, effectively canceling the previous process for procurement of these weapons systems, in which BAE Systems was fielding the FH77 B05, (an upgraded version of the FH77 B02 in service with the army) against Singapore Technologies (ST) Kinetics’ iFH 2000.

The army, which had issued the RFI on Thursday, gave much cause for confusion, by initially alluding to ‘A Self Propelled Gun System mounted on a vehicle chassis such as CEASER 155 mm Self propelled Gun’. The line was deleted on Friday evening, to remove any doubts about the earlier tender process being canceled.

During the day, on Friday, sources in the Ministry of Defense confirmed that the RFI, indeed, indicated a fresh tender for 155 mm/52 caliber Towed Artillery Guns. The reason the ministry gave for this decision was the creation of a single-vendor situation due to the non-appearance of the ST Kinetics’ gun at the trials.