India and Russia have inked a ₹5,124-crore deal for production of AK-203 assault rifles at Amethi, but timely delivery of the weapons will depend on the completion of a localisation plan and signing of two more contracts within a month, after which manufacturing can commence.
The deal, signed at the India-Russia bilateral summit recently, is for production of over 600,000 assault rifles over 10 years with complete transfer of Russian technology. In addition, there could be fresh orders from the paramilitary forces as well as export options.
While the overarching deal has been signed, the defence ministry will now need to sign two additional contracts, one of which will be with Russia’s Rosoboronexport for support to set up the factory and initiate technology transfer. The other will be with Advanced Weapons and Equipment India Ltd (AWEIL) (erstwhile OFB) which will assure indigenisation and involve several local vendors as part of the localisation plan.
“The contract is beneficial to all parties. Indigenisation will be taking place in 32 months. To these ends, three contracts will be signed, the first and the underlying one has been signed at the 2+2 ministerial meeting,” Maj Gen Sengar, CEO of the Indian-Russian Rifles Private Limited joint venture said.
The AK-203 deal is the biggest signed between the two nations in recent times, with the Russian side owning 49.5% of the shares.
Sengar said, “It is these two contracts on which the success of the JV depends, as they outline the mutual commitments of the Russian and Indian industrial partners.”
Work is on to finalise the contracts at the earliest to meet technology transfer and production timelines.
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