The delayed approval for the acquisition of the M-777 ULH means that India will have to bear a much higher price because of the weaker rupee.
The India-Japan Joint Working Group (JWG) have held preliminary meetings to initiate the process for acquisition of the ShinMaywa US-2i amphibious aircraft for the Indian Navy.
The 37 percent escalation by a margin of roughly INR 1,200 crore for the US government offer to India for 145 M-777 light weight howitzers comes into effect on Tuesday, along with the imminent closure of the assembly line for the artillery.
Carter is looking at the Indian defense ministry to make it easier for US companies to do business with it and wants resolution of issues related to offsets, limitation of liability and delays in decision-making.
The Indian defense ministry has till October to take the US government offer for the purchase of 145 light weight howitzers at the price of USD 694 million, after which the increased price of USD 885 million will come into play.
In purely dollar terms, the new price represents a 37 percent hike in the cost of the offer to India, but would effectively be even higher given the fall in the value of the rupee against the dollar since 2010.
The defense ministry has issued a Letter of Request to the US Government for the procurement of 145 pieces of M777 light howitzers, manufactured by BAE Systems.
The Indian Air Force (IAF) is looking for 22 attack helicopters through a tender, where Boeing’s Apache is up against the Russian Mi-28, and in the event the former is selected, some components of the aircraft will have to be purchased through an FMS.