CCS takes up ₹5.1k-cr AK-203 deal ahead of Putin’s visit
The Cabinet Committee on Security (CCS), headed by Prime Minister Narendra Modi, on Wednesday took up a ₹5,100-crore deal with Russia to jointly manufacture AK-203 assault rifles at a facility in Uttar Pradesh’s Amethi, ahead of Russian President Vladimir Putin’s two-day visit to India on December 6 for an annual summit with the Indian prime minister, officials familiar with the matter said on Wednesday.
The AK-203 deal was on the CCS’s agenda and a deal could be signed soon, said one of the persons cited above. There was no official word on the committee green-lighting the proposed deal, which was cleared by the defence ministry last month, as previously reported. HT spoke to four senior government officials, none of whom confirmed if CCS had cleared it, although the deal faces no hurdles and there’s no reason for any delay.
All outstanding issues relating to cost and indigenous content in the weapons have been ironed out, and India is looking at an early conclusion of the deal, officials said last month.
The joint venture between Kalashnikov and a new weapons manufacturing division carved out of the erstwhile Ordnance Factory Board (OFB) seeks to provide a push to the government’s Atmanirbhar Bharat Abhiyan (self-reliant India campaign).
It envisages the production of up to 700,000 AK-203 assault rifles, and the Amethi facility is ready to kick off production next year once the deal is signed, officials said.
Last month, the defence acquisition council (DAC) – India’s apex military procurement body – granted some key approvals to accelerate the acquisition of AK-203 assault rifles to be made in India with the transfer of technology from Russia.
Putin’s two-day visit to India will have a major defence and security overhang. The delivery of the first squadron of S-400 air defence systems – part of a $5.4-billion contract with Russia for five systems – is expected to coincide with Putin’s visit.
India and Russia last week announced they would hold the maiden 2+2 dialogue of their defence and foreign ministers on the margins of the annual summit between Modi and Putin.
This will only be Putin’s second foreign visit since the Covid-19 outbreak – he travelled to Geneva in June for his first meeting with US President Joe Biden. Putin’s decision to travel to New Delhi reflects the importance attached by Russia to its special and privileged strategic partnership with India.
India and Russia are also expected to renew their military-technical cooperation arrangement for the period 2021-31 and sign several defence-related agreements during the summit. A key pact that could be inked is the Reciprocal Exchange of Logistics Agreement (RELOS), which will allow militaries of the two nations to access logistics and support facilities at each other’s bases.
The government has taken several measures to boost self-reliance in the defence sector. These include raising the foreign direct investment limit in defence manufacturing, creating a separate budget for buying locally made military hardware and notifying 209 defence items, including assault rifles, which cannot be imported. India set aside ₹70,221 crores this year for domestic defence procurement, accounting for 63% of the military capital budget. Last year, the ministry spent more than ₹51,000 crores, or 58% of the capital budget, on domestic purchases.