India May Finalize $500 Million Spike ATGM Deal with Israel

India is likely to finalize a $500 million government to government deal with Israel for the purchase of 4500 Spike anti-tank guided missiles for the army during the Israeli official’s visit to New Delhi.

If approved by the Indian government, the Israeli defense ministry director-general Udi Adams is expected to sign the agreement during his visit in India next week, Hindustan Times reported quoting Indian defense ministry officials and Israeli diplomats as saying Wednesday.

The deal was initially conceptualised as one with a significant “Make in India” component. That component has now been reduced on grounds of commercial consideration, the news daily reported.

Udi Adams arrives in India on July 2 and leaves a day later after holding meetings with his counterpart Sanjay Mitra; he is also expected to pay a courtesy call to defence minister Nirmala Sitharaman.

Rafael was selected as a winner for the Indian Army’s tender to procure more than 8000 Spike ATGMs which included manufacture of 3000 of the missile systems in India under the ‘Make in India’ program.

The procurement was changed to the government-to-government route after Israeli Prime Minister Benjamin Netanyahu visited India this January. The contract has now been revised to direct purchase of 4500 weapon systems with a small quantity being manufactured in Hyderabad.

Rafael has a tie-up with Indian Kalyani Group and it also opened a production facility in August last year near Hyderabad.

While Israeli diplomats insist that the agenda for Adam’s trip is global defence and security related issues, India will also discuss the possible purchase of two more PHALCON-AWACS for the air force from Israel. This state-of-the-art radar with deep penetration capability is mounted on the Russian IL-76 platform and is expected to cost around $1 billion. India already has three of these advance warning and early detection planes which can look deep into enemy territory. The other military hardware deal on the agenda would be manufacture of TAVOR-21 assault rifles for the Indian security forces under the “Make in India route”.