Ammunition Procurement from Private Sector

Keeping in view the production capacity shortage and resultant restrictions on training, the Army issued RFPs on 25 March 2017 for the under mentioned types of ammunition for the yearly requirement for next 10 years. The overall cost of the procurement has been pegged around Rs. 150 billions. The initiative for the indigenisation of ammunition is to create an inventory for all major weapons to enable the forces to fight a 30-day war while the long-term objective is to cut dependence on imports.

The ammunitions in the RFP are fired from Indian Army's existing in-service weapons and the average yearly requirement and the production targets can be revised based on the result of the first phase of the implementation of the programme. Some of them are partly being made/ attempted by OFB and others are imported till date. These are:-

  • 23 mm HEI/APIT for ZU / Strella air defence gun system
  • 30 mm HEI/HET for BMP II
  • Electronic Fuzes for Arty Gun systems
  • BMCS Low Zone & High Zone for Arty Gun Systems
  • 125 mm FSAPDS for Tank T90/ T72

Some of the specialist ammunition such as BM-21 GRAD Rockets, 30 mm VOG 17 for 30 mm Automatic Grenade Launcher, 40 mm HEAP, HEDP, RP, TM& VOG 25 for40 mm Multi Grenade Launcher/ UBGL etc are exclusive East European design and none of them are currently being manufactured in India. The country has only the performance parameters and test schedule and no Design documents. This would need the partnership with OEM, who has the design, as tweaking the design by other than OEM has not been satisfactory,

The Tentative time schedule to complete the Users and DGQA Trials by Oct 2018 and CNC and contract by 12 Nov 2018.The Bid validity is likely to be about 2 Years.
There are certain mandatory requirement in the RFP :-

  • It is mandatory for the Development Agencies (DA) to take an undertaking, from the proposed suppliers of critical technology sub-systems, for transfer of technology (ToT), manufacturing rights, unhindered supply, full usage/exploitation, and upgrade in technology and export permission to the DA concerned and the MoD.
  • There is no restriction on Foreign/Indian technology provider for tie ups with more than one Vendor/ Consortium.
  • The consortium will have to nominate a lead member.
  • It is mandatory for a respondent/ Consortium to provide core technologies with all Rights / Licenses.
  • Only one Indian production agency is to be selected for each item to produce required annual target.
  • No company to be given order for more than 3 items.
  • The companies may source items/ chemicals from OFB and this has to be their arrangement.
  • Firm has to manage at it own IL for Ammunition
  • Designs conforming to end use with better logistics which meets the Ballastics/end use will be considered.

The relevant details in brief are Tabulated below:-

The development and production of ammunition is capital intensive and faces regulatory hassles like production of explosives and test facilities. The Government need to take steps to ease the process for private sector. To help the private sector to recover the sunk in cost for producing the ordnance a minimum 10-years order book should help in the creation of a viable business plan, and the government will allow them export the products with minor controls.The procurement reflects the intention and effort by the government to leverage the private sector to meet India's defence needs. It also indicates some thought in the direction to safeguard the supply of ammunition from subsequent technology denial and to allow for the “surge manufacture” needed in wartime. Although RFP has been issued for above mentioned ammunition, there are others types of Ammunition as well, where we need to create additional capabilities.

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