BAE Systems has won a $542 million contract to provide 145 M777 ultra-lightweight howitzers to the Indian Army.
Work on the contract will begin immediately and be performed by BAE Systems and its suppliers across the United Kingdom, United States, and India. Deliveries are scheduled to begin in June 2017, the company said in a statement Thursday.
India had signed a deal with the US for importing the Howitzers for $750 million via a Foreign Military Sale with the US government in December last year.
BAE Systems had announced a plan to establish an Assembly, Integration & Testing (AIT) facility in India as an integral part of the offset offer to the Government of India.
The offset offer commits to investing in, and the development of, a number of Indian defence suppliers, providing them with access to the BAE Systems group across Air, Land, Sea and Security programs. The conclusion of this procurement will enable BAE Systems to make an investment of over $200 million in those Indian defence suppliers.
The Indian defense procurement agency had approved the proposal in June last year. The deal had not progressed since 2012 due to cost issues and because the BAE had not been able to come up with a proposal fully complaint to the offset requirements.
“Two guns will be delivered to the Army within six months from the signing of the LoA for preparing the range tables and calibration,” The Hindu quoted an unnamed source as saying in December last year.