Russia bags $1.5-billion deal to sell air defense missiles to India

Following major deals to sell naval warships and S-400 system to India, Russia is all set to bag a $1.5-billion contract for air defense missiles. Sources close to the matter state that the Russian Igla-S system was confirmed as the lowest bidder for the deal to supply shoulder fired anti-aircraft missiles for the Indian Army.

The Russian bid for $1.5 billion would considerably undercut offers by Sweden and France and is believed to be even lower than the benchmark price of $2 billion that was estimated by India, cite sources. 

For the record, the process to procure Vshorad (Very Short-Range Air Defense) missiles was initiated in 2010 under the previous ruling government and apparently went through numerous trail rounds before the Igla-S qualified in early 2018, along with two other competitors. 

The Vshorad program, to replace Russia’s previous Igla-M systems used by the Indian Army since the 1980s, is considered proficient for defense against incoming UAVs, helicopters, and ground attack aircraft. Sources close to the deal cite that the bidding initially included four dealers out of which MBDA’s Mistral and Swedish SAAB RBS70 NG were found compliant besides the Russian system, while the Koreans failed to make the cut.

Competitors raised numerous objections regarding the Russian system, alleging it to be ineffective in demonstrating low-level target hits in desert environments in summer conditions and being inefficient in locking targets at long distance. However, the accusations were examined by independent inspectors at the defense ministry, who later made the decision to announce Russia as the winner of the deal for further opening a commercial tender.

As per reports, in March 2018, the Indian Army had informed the parliamentary panel on defense regarding lack of funds that would eventually impact the Vshorad procurement. The Indian Army reportedly acquired Rs 17,756 crore less than what it had expected in the annual budget.