Israeli Defense Firm Denies Reports That Half-billion-dollar Arms Deal With India Is Off

Rafael Advanced Defense Systems tells Haaretz the deal has already been set into motion and 'will continue as planned'

Simulation of Spike antitank missile
Rafael Advanced Defense Systems

Seemingly broadsided by press reports in India on Monday that its half-billion-dollar joint venture there to build anti-tank missiles had been canceled, the Rafael Advanced Defense Systems denied that the deal is off.

"Rafael has not been officially informed of any change in the decision to purchase Spike missiles," Ishai David, deputy spokesman for Rafael, told Haaretz. "Spike is in use with 26 different militaries around the world, and was selected by India after a long and rigorous process."

David added that Rafael already "began the transfer of development and manufacturing knowledge as part of the Make-in-India program. This activity will continue as planned."

Debashish Biswas, the second secretary of press and information at the Indian embassy in Israel, said he could not comment as no information had provided as of Monday afternoon.

Earlier Monday, Indian press sources reported that the Ministry of Defense decided to spike the deal with Rafael, announced just this August, to manufacture guided antitank missiles with the local company Kalyani Strategic Systems.  

The Spike
Gil Eliahu

The ministry preferred to follow the policy set by Indian Prime Minister Narandra Modi and encourage local manufacturing, the press reports suggested.

Rafael today says however that after negotiations, it already established a joint manufacturing facility with India's Kalyani Group  and BDL, "and began the transfer of development and manufacturing knowledge as part of the Make-in-India program. This activity will continue as planned," it stated.

Some defense industry insiders had been surprised by India's choice of Israeli technology in the first place, as opposed to buying American-made Javelin missiles. Production was to be done in Hyderabad, in the joint venture with Kalyani that Rafael just announced this August.

However, according to Indian press reports, the Indian government has tapped its own Defence Research and Development Organization to develop a "man-portable" antitank guided missile instead.

Deliveries by the joint Israeli-Indian venture were expected to start in 2018. Development of the technology from scratch could well take some four years, Zee News reports. It bears adding that the Indian development authority has created anti-tank guided missiles before, the Nag and Anamika.

Just this August, Rafael announced the inauguration of a missile manufacturing plant in India with Kalyani. India had been expected to buy around 8,000 antitank missiles from the plant.

Canceling the deal could be another turning point in Jerusalem-Delhi relations. Earlier this month, pundits noted "the warming relations" between the two nations, as shown by Indian Air Force commandos taking part in joint exercises with their Israeli counterparts for the first time ever, during "Blue Flag,” the largest air force exercise ever held in Israel.

Rafael's Spike anti-tank missiles.
Rafael Advanced Defense Systems