The Ministry of Defense (MoD) has decided to cancel the $500 million deal Spike Anti-Tank Guided Missile (ATGM) for the Indian Army.
Instead, the ministry has asked the Defence Research and Development Organisation (DRDO) to develop an indigenous Man-Portable ATGM.
The cancellation of the deal, which was seen as a sign of increasing Indo-Israel defense cooperation, would delay the Army’s modernization program.
In 2009, the MoD accepted a proposal to acquire 321 ATGM launchers with 8,356 missiles with 30% offsets and transfer of technology.
Israel’s Rafael responded to the proposal and the Indian Army conducted trials for the Spike missiles in 2012-12.
The MoD cleared the purchase of the Spike.
The US government later pitched Raytheon-Lockheed Martin’s Javelin ATGM but India stuck with the Israeli Spike.
In 2015, price negotiations between the MoD and Rafael began. In 2016,the prices were finalized.
The same year, the then Defense Minister Manohar Parrikar formed an expert committee to review whether an indigenous missile system could be an alternative.
Initially, there were differences between the DRDO and the Army.
However, earlier this month, the Army agreed to retract the proposal for Spike ATGMs.