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The Defence Acquisition Council (DAC) approved the purchase of around 400,000 close-quarter carbines “to combat the current complex paradigm” of conventional warfare, hybrid warfare and counter-terrorism at the borders, the ministry statement said. An Acceptance of Necessity (AoN) is the first step in any defence procurement process.

The close-quarter carbines will be for front-line soldiers deployed along India’s borders, including the Line of Actual Control (LAC) with China, where the two countries have been locked in a tense standoff since May 2020.

The central government is planning to indigenously manufacture carbine for the army, navy and air force and has currently put its deal with UAE on the side. It is yet another effort by the government to promote the vision of ‘Atmanirbhar Bharat’ and pushing India to gain its foothold in defence manufacturing.

Earlier the Indian army was planning to buy Carbine from the United Arab Emirates (UAE). Keeping it aside for the moment, about 4.2 lakh carbines are to be made in India for the army, navy and air force collectively.

The defence minister was tight-lipped on whether the procurement will be through the ‘Buy Indian’ category or through the Indigenously Designed, Developed and Manufactured (IDDM) route. Initial estimates suggest that the allocation for the project is going to be over Rs 5,000 crore. It is likely that the production of over 4 lakh carbines and their contract will be allotted to two manufacturers from the private or public sector. 

Procuring through the Buy Indian category will mean that several foreign companies who either have or will have joint ventures with Indian firms will be participating.

Under Indigenous Design, Development & Manufacture (IDDM), the competition would have been between only three firms, out of which only one would have been a private firm.

The likely calibre requirement will be the 5.56×45 NATO, and not the 5.56×45 INSAS. While the former is the one used globally, the latter is a slightly different calibre used by India for its INSAS series of rifles, which will be replaced by the AK 203. It is learnt that the carbines may be limited to is likely to be a maximum 3.2 kg.

The main companies in contention will be Bengaluru-based private defence firm SSS Defence, PLR of the Adani Group, the Ordnance Factory Board (OFB), Kalyani Group — which has a tie-up with French firm Thales but is also in talks with the Defence Research and Development Organisation (DRDO) —  the Jindal Group, which has tied up with a Brazilian firm called Taurus, and Neco Desert Tech, a joint venture between Indian and American firms.

However, if the deal is opened up to non-locally manufactured carbines, then more companies will participate on the condition that they will set up a manufacturing base in India if they bag the contract.

SSS Defence could offer its indigenously built M72 Carbine while PLR is likely to present its Galil Ace. PLR has tied up with Israel Weapon Industries (IWI) and is already manufacturing various small arms in India. The Kalyani Group is likely to tie up with DRDO for the project, while OFB will be offering its own product.

If the competition opens up, the UAE’s state-owned firm Caracal, which had emerged as the lowest bidder for a now-junked fast-track procurement (FTP), will also throw in its hat. While the firm was initially in talks with Reliance Defence for a tie-up, the deal did not go through.

Background

The Army has been trying to acquire the CQB carbines since 2008 to replace its outdated and ageing 9mm British Sterling 1A1 submachine guns that are in service. Both DRDO and OFB had failed to meet the Army’s requirements back then, and a global tender for procurement of 44,618 CQB Carbines was issued in 2011.

While four companies — Israel’s IWI, Italian Beretta, and American firms Colt and Sig Sauer — participated, only IWI qualified as the other contenders could not meet the qualitative requirements pertaining to the night vision mounting system.

But the defence ministry did not go ahead with IWI because it had become a single vendor case, which, according to the government’s procurement manual, is not allowed.

In 2017, a global RFI — a process initiated to gather information on what is available in the market — was issued for the purchase of 2 lakh carbines, while a separate process was rolled out to procure 93,895 under FTP.

Caracal had emerged as the lowest bidder but the contract for its CAR 816 had run into rough weather over a number of issues including costs and complaints from other bidders.

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Bhandari is asking the court to order Thales to pay him commission that he says he is owed, which Thales denies. In his claim against Thales, Bhandari alleges that he was hired by Thales to secure a €2.4 billion (Rs 20 crore) contract to upgrade Mirage 2000 military jets for the Indian Air Force. The contract was signed in 2011. The Telegraph states that “Mr Bhandari alleges that from 2008 he helped Thales sell the upgrade of the Mirage jets by facilitating a meeting” with a senior Indian official.

“He claims that he was due a consultancy fee of €20m (Rs 167 crore) but was only paid €9m (Rs 75 crore). Mr Bhandari alleges this was due to political factors in 2016 when he was close to the Indian Congress Party. At this time the ruling BJP party … started persecuting him, he claims. He fled to the UK where he is currently fighting extradition on unrelated matters and is claiming political asylum,” the British newspaper stated. This is the first time it has been alleged that Bhandari, who fled to Britain in 2016, has applied for political asylum in Britain.

According to the claim, Bhandari was paid by Thales via “an elaborate financial covert scheme in India and Dubai which enabled the payment of secret commissions to intermediaries. A special subsidiary called Thales Middle East & Africa is alleged to have been in charge of the deployment of these financial structures”. The claim alleges that Thales awarded offset contracts to two companies based in Bengaluru, which paid part of the sums received from Thales to a Dubai-based company called UHY Saxena Consulting, which paid fees due to Bhandari.

The fugitive arms lobbyist alleged that this was due to political factors in 2016 because he was close to the Congress Party. Bhandari has described himself in the lawsuit as a “well-known commercial intermediary involved in arms and defence in India”, who has “worked with major international defence companies to assist them in negotiating arms contracts with the Indian Ministry of Defence”.

The newspaper conjectured that the case could impact India’s future purchases of Rafale fighter jets. India is in the midst of procuring 26 twin-engine fighter jets for India’s first indigenous aircraft carrier (IAC) INS Vikrant in a deal said to be worth more than $2 billion.

The Rafale-M (marine) fighter jet arrived is being tested by the Indian Navy from its shore-based test facility in Goa. In March the Indian Navy will try out the F-18 Super Hornets supplied by Boeing in the US and then the Indian government will decide which one to order.

The timing is significant as it comes just weeks before Bhandari’s main extradition hearing starts in London on February 21. India is seeking to extradite Bhandari from London to India to face charges of tax evasion in India between April 24, 2016 and September 22, 2019. He is facing multiple other probes and court cases in India.

Extradition Sought

India has moved to the UK for his extradition for money laundering and tax evasion cases against him. A hearing in the case is due in London next month. Bhandari is currently on conditional bail in the UK awaiting the outcome of his extradition case.

Indian agencies in coordination with the Ministry of External Affairs are engaged in preparation for his extradition hearing scheduled in February.

A joint team of the Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) is engaged in preparing documents with foolproof evidence that could help both the agencies to put forth their case during Bhandari’s extradition hearing pending in the UK.

Both the agencies have engaged Joint Director level officers who in coordination with the investigating officers have expedited the process to gather documents linked to the case.

Bhandari received over Rs 400 crore

Sanjay Bhandari allegedly received payments worth over Rs 400 crore from foreign companies in connection with weapons deals conducted during the UPA regime, records from transactions conducted in several firms in Dubai reveal.

The bank records, which are available with investigative agencies, indicate that a bulk of the money (Rs 328 crore) was transferred by Switzerland-based Piltaus Aircraft Limited, which had been awarded a deal to supply trainer aircraft for the Indian Air Force, under a questionable procurement process even after alarm bells had been rung on serious lapses in the selection.

The Swiss firm Pilatus was banned from doing any business with the defence ministry in 2019, following the registration of formal cases by the Central Bureau of Investigation (CBI) into charges that corrupt practices were used by the company. The Rs 2,800-crore deal for trainer aircraft was signed in 2012.

According to the records, Bhandari received Rs 328 crore in three different companies registered in Dubai from Pilatus, with the payments starting in July 2011 and continuing till September 2015. The arms agent, who was raided by the Income Tax department in 2015 fled to London the following year with investigative agencies probing several major deals allegedly facilitated by him during the UPA regime.

Bhandari has also been charged under the Official Secrets Act (OSA) after classified documents were found at his residence during raids in 2016. Bhandari’s firms in UAE, Offset Solutions India FZC, allegedly received at least Rs 3.47 crore from France based Thales International, which has supplied a range of products to the Indian armed forces, including major components for upgradation of the Mirage 2000 fighter fleet in 2011. The deal was valued at E2.4 billion.

As per the records, these payments were made in several tranches between September 2010 and June 2012.

The records also show payments worth Rs 70 crore from a South Korean firm to bank accounts controlled by Bhandari in Dubai, allegedly for facilitating a deal with ONGC in 2009.

Proximity to Congress Party

Bhandari, considered close to Congress leader Rahul Gandhi’s brother-in-law Robert Vadra, had fled India in 2016 following raids at his residence for allegedly possessing classified information on the country’s defence purchases. He was later charged under the Official Secrets Act.

Bhandari had purportedly received a kickback of Rs 328 crore in connection with the Pilatus Aircraft deal. He has also been linked to several other business agreements, including the ONGC deal.

Between 2010 and 2012, more than Rs 3.47 crore had been transferred by Thales International, the Middle East into a bank account that is believed to belong to the fugitive defence middleman in conjunction with another defence deal relating to aviation products. The company named in the accessed documents is Offset India Solutions – of which Bhandari is a director.

The Enforcement Directorate had conducted raids on HL Pahwa in May 2017 which linked a land deal connection with the Gandhi family and HL Pahwa who was funded by one CC Thampi, who has close financial links to Sanjay Bhandari. From files seized by the ED during raids at HL Pahwa office the link was established and it needed further probe.

In August 2020, ED had raided 14 locations related to Bhandari in connection to the Pilatus aircraft scam.

Bhandari is also under the scanner of the CBI as well for allegedly purchasing Benami properties for Robert Vadra, the son-in-law of Congress president Sonia Gandhi.

CBI’s inquiry had found that Bhandari’s company had received the kickback amount through his Singapore-based bank account in 2009. From there the money was laundered to Bhandari’s company in Dubai and then, it was allegedly used to purchase properties in London. It is notable here that the ED has already stated in open court that Bhandari was acting on behalf of Robert Vadra for the purchase of properties in London.

Thales’ Denial

Thales denies the claims, saying it never hired Bhandari and does not use middlemen.

Thales told The Times of India, “Mr Bhandari filed a petition against Thales SA in a commercial court in June 2021 for the settlement of sums allegedly due to him on an aeronautical modernisation project. Thales firmly denies the claims by Mr Sanjay Bhandari regarding the sums allegedly due or any other payments to him by Thales SA. Thales has never signed a contract with Mr Bhandari or his companies in connection with this project. Thales complies with the law and applies a zero tolerance policy on corruption and influence peddling. The group’s integrity programme is regularly evaluated and amended to reflect changes in applicable legislation and best practices.”

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In a major boost to Defence Production under the ‘Make in India’ initiative and towards achieving self-reliance in the critical field of Defence equipment, Goa Shipyard has placed a maiden order on Bharat Heavy Electricals Limited (BHEL) for supply of an upgraded Super Rapid Gun Mount (SRGM), the Main gun onboard most Warships of the Indian Navy.

The order envisages supply, installation and commissioning of the entire system – Upgraded SRGM and accessories for Triput Class Frigates of the Indian Navy, which will be manufactured by the Haridwar unit of BHEL.

The upgraded SRGM is a state-of-the-art weapon system having additional features such as capability to manage different types of ammunition to engage fast, manoeuvring and non-manoeuvring, radio controlled targets. The upgraded SRGM has the capability to fire advanced Ammunition with higher range and programmable ammunition.

BHEL has been a reliable supplier of critical equipment and services in the Defence and Aerospace sector for over three decades with the aim of making a major contribution towards self-reliance in these sectors.

Towards this, BHEL has established dedicated, intricate manufacturing and inspection facilities at its manufacturing plants, for production, installation & commissioning and lifecycle support of various products and components. The initiatives taken by BHEL will be a driving force towards the AatmaNirbhar Bharat Abhiyan of the Government of India.

LCA-Mk2 to Roll Out Next Year

The configuration for the Light Combat Aircraft (LCA)-Mk2 has been frozen and steel cutting is expected to begin soon while configuration for the fifth-generation Advanced Medium Combat Aircraft (AMCA) has been frozen and preliminary design completed, Dr Girish S. Deodhare, Programme Director (Combat Aircraft) & Director, ADA, said at a seminar in New Delhi on 12 September.

“The detailed design is complete. In fact, we are in the critical design review stage and metal cutting should start very shortly. Roll-out of the aircraft (Mk2) is planned next year and the first flight in early 2023. We are well on track to achieve these goals,” Dr Deodhare said.

The aircraft features enhanced range and endurance including an onboard oxygen generation system, which is being integrated for the first time, Dr. Deodhare said.

Heavy weapons of the class of Scalp, Crystal Maze and Spice-2000 will also be integrated on the Mk2. The LCA-Mk2 will be a heavier and much more capable aircraft than the current LCA variants.

The Mk2 is 1,350 mm longer featuring canards and can carry a payload of 6,500 kg compared to 3,500 kg the LCA can carry.
In February, the Defence Ministry signed a Rs 48,000-crore deal with Hindustan Aeronautics Ltd. (HAL) to supply 83 LCA-Mk1A to the Indian Air Force. In August, the HAL signed a $716 million deal with GE Aviation of the U.S. for 99 F404 aircraft engines and support services to power the Mk-1A. The Mk2 will be powered by a more powerful GE-414 engine.

The Indian Air Force (IAF) has one squadron of the LCA in initial operational clearance and deliveries of the second squadron in final operational clearance configuration are under way.

The HAL has already set up a second assembly line to ramp up production from eight aircraft a year to 16. Order for 83 Mk-1A is expected to be completed by 2028-29, Dr. Deodhare said.

Preliminary Design Review of AMCA Completed

According to Dr Girish S. Deodhare, Programme Director (Combat Aircraft) & Director, ADA, the the configuration of the Advanced Medium Combat Aircraft (AMCA) had been frozen, preliminary service quality requirements finalised and preliminary design review completed. The initial design of the AMCA was started way back in 2009.

“We are moving to critical design review by the middle of next year with the roll-out planned in 2024 and first flight planned in 2025,” he said at a seminar on 12 September, in New Delhi.

The AMCA would be a twin engine stealth aircraft with an internal weapons bay and a diverterless supersonic intake, which has been developed for the first time for which the design is complete.

It will be a 25-tonne aircraft with internal carriage of 1,500 kg of payload and 5,500-kg external payload with 6,500 kg of internal fuel.

The AMCA will have stealth and non-stealth configuration and will be developed in two phases, AMCA Mk1 with existing GE414 engine and an AMCA Mk2 with an advanced, more powerful engine to be developed later along with a foreign partner, Dr. Deodhare added.

The manufacturing and production of the aircraft will be through a special purpose vehicle, which will also have participation of private industry.

Simultaneously, the project for development of a twin-engine deck-based fighter jet meant to fly from the Navy’s aircraft carriers is also making progress. On the various programmes under way, Dr. Deodhare said there was commonality of systems and technologies.

Aerostructures of Boeing’s F-15EX Eagle II to be Built in India

Aerospace major Boeing has awarded a contract to India-based Dynamatic Technologies for manufacturing assemblies for its tactical fighter ‘F-15EX Eagle II’. This is a first instance in which aerostructures for F-15EX Eagle II will be made in India. Besides, the contract will given a boost to the ‘Aatmanirbhar’ programme and strengthens US-India collaboration on aerospace and defence industrialisation.

Accordingly, Dynamatic Technologies will supply the F-15EX aerostructure assembly requirements from FY22. The company will manufacture these aerostructures from their manufacturing facility in Bengaluru, Karnataka.
According to Boeing India President Salil Gupte: “We see tremendous potential for India to contribute to the global aerospace industry as an industrial and technology partner.”

“The award of aerostructure assemblies for the latest and most advanced version of the F-15 aircraft family is a reflection of Boeing’s focus on Aatmanirbhar Bharat and a testimony to the world class capability of our industrial partners in India.”

Army Taps Tonbo Imaging for Specialised Sights

The Army has placed orders with with a Bengaluru-based firm – Tonbo Imaging – for specialised sights under emergency procurement to help some of its elite units operating in both urban warfare and at the borders. The order for two set of sights as part of a spate of emergency procurement being done was placed “recently”.

One contract is for about 600 pieces of multi-functional thermal imaging binoculars for target acquisition and the other is for multi mission-sight, which can be mounted on the helmet and also the weapon.

The contract value is for over Rs 100 crore and the procurement is being done by the Infantry Directorate, adding that while earlier the Northern Command had procured one of these sights for its soldiers in smaller batches, this time the Army Headquarters is doing it.

They also said that there would be a larger procurement order in play if the systems, which have to be delivered in 12 months, perform according to expectations.

The multi-mission sights are lighter and more tuned for close combat.

Tonbo Imaging is one of the few companies in the world to manufacture such systems. Some of their products are deployed at the Line of Actual Control (LAC) during the ongoing Ladakh standoff for surveillance operations.

When the company initially began commercial operations around 2012, it focused on the global market. Five countries were buying their products before India bought from Tonbo. Founder Arvind Lakshmikumar’s prior work with US’ DARPA (Defense Advanced Research Projects Agency) helped him get recognition of products early on in the US market.

Rolls-Royce, HAL Pact for Adour Engine Parts

Rolls-Royce and Hindustan Aeronautics Limited (HAL) signed a “Make in India” agreement, on 14 September, to manufacture parts for Rolls-Royce’s Adour engines that will support the UK-headquartered company’s international defence customer base.
Variants of the Adour engine power the Indian Air Force’s (IAF) Jaguar fighters as well as its fleet of Hawk advanced jet trainers (AJT). The IAF has the world’s largest serving fleets of both these aircraft. HAL has manufactured and supported Adour engine variants, under licence from Rolls-Roy­ce, over several decades.

However, Rolls-Royce now aims to strengthen the spares and maintenance eco­system for Adour engi­nes in India. Rolls-Royce and HAL signed a Memorandum of Understanding (MoU) during Aero India 2021, in February, to establish an Authorised Maintenance Centre for Adour at HAL to support international military customers and operators.

Rolls-Royce underscores a three-point aim in the current initiative. The first is to equip Indian manufacturers with the knowhow, pro­cesses and experience to build complex parts that require a lot of high-technology processes. That would en­hance current capabilities and serve to make India atmanirbhar (self-reliant). Secondly, exporting parts from India would enhance supply chain efficiency and benefit Rolls-Royce’s global operators. Thirdly, since the Adour engines will continue to fly in India for the longest time, a self-sufficient supply chain would be in place to support those older engines.

Thales to Provide Emerging Technologies for Armed Forces

Leading French defence major Thales Group is planning to focus significantly on addressing requirements of the Indian armed forces for new-age cyber security solutions, artificial intelligence and advanced capabilities in big data analytics.

Chairman and CEO of Thales Group Patrice Caine said the company has been looking at expanding its overall footprint in India, particularly in the areas of emerging technologies that will be crucial for the armed forces.

The Indian Army, the Navy and the Indian Air Force have been focusing on acquiring futuristic technologies like nanotechnology, quantum computing, artificial intelligence, swarm drones and robotic technologies to deal with future security challenges.

Thales Group is aiming at expanding its overall footprint in India in a number of segments, including in areas of cyber security, artificial intelligence and digital solutions.

India is expected to spend close to $300 billion in the next five years in procuring defence equipment and almost all major global defence firms are eyeing a slice of it.

India is now considered as a key country for sourcing various raw materials for the company’s global production line and it is going to double procurement from the country in the next five years.

Thales is part of the French firms that provided key components for the Rafale jets procured by India. As part of Thales’ offsets commitments under the Rafale deal, the company helped Bharat Electronics Ltd (BEL) in producing modules for the RBE2 radar.

Thales has been providing avionics and other equipment to the state-run aerospace behemoth Hindustan Aeronautics Limited for over four decades and is involved in supplying equipment for various other key military projects.

Present in India since 1953, Thales has offices in New Delhi, Gurgaon, Hyderabad, Bengaluru, Chennai and Mumbai, among others. Over 600 employees are working with Thales and its joint ventures in India.

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The BEL’s engineers were trained at the French facility of Thales as per the offset agreement.

“The modules produced in India (by BEL) are then integrated with the RBE2 radar in France. BEL and Thales teams are, thus working closely to transfer advanced technological know-how,” the Thales’s statement said.

The first batch of five Rafale jets arrived in India from France on July 29, 2020, nearly four years after India signed an inter-governmental agreement with France to procure 36 of the aircraft at a cost of Rs 59,000 crore.

A total of 11 Rafale jets have been delivered by its manufacturer Dassault Aviation till now.

V Gowtama, Chairman and Managing Director, BEL, said, “We are happy to be associated with Thales in delivering the transmit/receive modules for the prestigious Rafale programme. The Thales and BEL teams ensured that the ToT (transfer of technology) happened seamlessly.”

“We have augmented our facility in Bangalore to meet the requirements of manufacturing this state-of-the-art sub-system. We look forward to working together on many more such challenging assignments with Thales,” he stated.

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Called the “STARStreak”, the air defence system has a mix of shoulder fired anti-aircraft guns.

The STARStreak Missile System is in service in the British Army and has been procured by defence forces worldwide. The fastest missile in its category, STARStreak has three laser-guided darts, which cannot be jammed by any known countermeasure. It has the capability to defeat any air target – even armed helicopters – and form the last line of defence.

BDL will be a part of the STARStreak global supply chain with an opportunity to export the system to existing and future customers, including the UK Armed Forces.

Earlier, Thales and BDL had signed a Memorandum of Understanding to assess the opportunity for the transfer of technology for STARStreak.

The agreement will allow BDL to offer the STARStreak missile system to the Indian Armed Forces with a minimum of 60 per cent indigenous content as well as design and development of the system, qualifying it under the ‘Make in India’ programme.

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