India’s New Artillery Competition is Halted Again

by: Matthew Potter
July 23, 2010

Category: BAE Systems, Business Line, Companies, Contract Awards, Countries, Events, India, logistics, production program, Proposal | RSS 2.0

The eight year struggle for India to buy a new towed and self-propelled 155 mm howitzer is reportedly on hold again due to corruption issues. The current attempt was at the trial stage with prototype artillery pieces. These trials are now on hold. This is due to the recommendation of the Central Bureau of Investigation to blacklist some of the firms involved in the competition.

India’s Armed Forces have desired a modern upgrade to their inventory of artillery for several years. The contract that started in 2002 was put on hold in 2004 because one contender was dropped due to corruption accusations against the South African Denal. Even though this was on another contract India has a policy of banning those companies and avoiding further work with them. Because India also tries to not award sole source contracts this meant the contest had to stop and start over again.

This was done in 2007-2008 with competitions but that contract was also placed on hold as the former director general of the Ordnance Factory Board was arrested and charged with taking bribes from one of the contenders. This company, Singapore Technologies Kinteics (STK), is participating in the current contest along with the United Kingdom’s BAE Systems. Both foriegn companies have Indian partners.

The CBI is now recommending that STK be banned although no charges have been filed. This could lead to an end to the current competition as only BAE Systems would be participating. That would further setback the contracting process delaying even longer the delivery of new artillery pieces.

India has had major issues over the last twenty years with corruption in military procurement contracts. At the same time the country has been trying to develop its own indigenous arms industry and has recently decided to open up their economy and military buying to more Western firms and allow joint ventures. Many U.S. and European aerospace companies desire using India’s economy to produce parts and services for use not only in that country but also to support their sales to other customers.

India though has to work out its contracting issues and finally begin upgrading its ground forces. This includes contracts for new helicopters, tanks and artillery.

Photo from David Paul Ohmer’s flickr photostream.

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