India and the US are likely to sign an agreement for the purchase of 145 American Ultra-Light Howitzers, worth about Rs 5,000 crore, this fiscal, the first deal for artillery guns since the Bofors scandal in 1980s.
The defence ministry on Thursday cleared the file for M777 guns, which would now be sent to the finance ministry before being put up before the cabinet committee on security.
Sources said the approval for certain “deviations” were made.
The ministry has already shortened the supply period of the guns, with a strike range of 25 km, though the exact period could not be known.
India had sent a Letter of Request to the US government showing interest in buying the guns which will be deployed in high altitude areas in Arunachal Pradesh and Ladakh, bordering China.
The US had responded with a Letter of Acceptance (LOA) and the ministry had in June looked into the terms and conditions and approved it.
The offsets, under which BAE Systems, manufacturer of the gun, will invest about $200 million, will be pursued independently.
While 25 guns will come to India in a fly away condition, the rest will be assembled at the proposed Assembly Integration and Test facility for the weapon system in India in partnership with Mahindra.
The howitzers, that can be heli-lifted, were first proposed to be bought from BAE about 10 years back.
The defence ministry also approved buying of over 4,900 radio sets for the Army’s Armoured Corps from an Israeli firm.