Rafael Advanced Defense Systems confirmed on Tuesday that its plant in Hyderabad, established last year in order to manufacture Spike anti-tank guided missiles together with the Indian business group Kalyani, remains open even though the deal for it to make the missile technology has been called off. The plant will simply make other things. Whether or not the plant will make Spike missiles too one day remains to be seen.
"The plant is designed to make additional systems, not just Spike. So there is no plan to close it down," Rafael's spokesman told Haaretz. According to The Hindu BusinessLine, reporting last year, the huge plant was planned to also make electro-optic systems, remotely controlled weapons and other advanced things.
In fact Indian authorities never did sign a definitive contract with Rafael to make Spike missiles, though negotiations had reached a stage so advanced that the plant's inauguration in Hyderabad, as a joint venture with Kalyani Group, was announced last August, with great fanfare. The half-billion dollar contract had been broadly assumed to be a given – until the Indian Ministry of Defense pulled out in November 2017, citing a desire to pursue a home-made anti-tank missile.
The Indian withdrawal in favor of indigenous development ("Made in India") had been revealed by the Indian press.
Detractors argued that it would take India years to develop its own smart anti-tank missiles, while Spike technology was right there and ready to roll. Yet the Indian ministry reportedly tapped the Indian Defense Research and Development Organization to proceed with the development of a man-portable smart anti-tank missile anyway that would compare with the Spike. The DRDO reportedly suggested it could produce a product in three to four years.
In early January this year, shortly before a visit by Prime Minister Benjamin Netanyahu to India, Rafael confirmed that India had pulled out of the deal, not that it had been signed. Two weeks later the Israeli premier was in New Delhi and the deal was back in play. National Security Adviser Meir Ben-Shabbat stated that the talks were trending in a positive direction.
Founded in 1948, the same year as the state, Rafael today is a government company that develops armaments and smart systems, which it sells locally and around the world. Hence the state has a real interest in the company's fortunes. Among the company's achievements are the development of the Iron Dome anti-ballistic system, a pioneer in shell and missile interception technology.
The company confirmed to Haaretz on Tuesday that Netanyahu, his people and the Defense Ministry are working to restore the Spike deal, but declined to elaborate whether it was still working with Kalyani, considering additional or other partners, or whether any other changes to the potential transaction are being contemplated. "There are negotiations at a number of levels," Rafael stated. One day the Hyderabad plant may make Spike missiles after all.