Amethi rifle manufacturing unit impasse more likely to be resolved, costing panel arrange

The impasse over beginning the Amethi rifle manufacturing unit to fabricate 6.7 lakh AK 203 assault rifles is more likely to be resolved, with the defence ministry stepping in by organising a costing committee to take the challenge ahead.

The value bid for the ₹4,300-crore challenge has been submitted and the committee has been given two months to achieve an agreeable value for the challenge. As reported by ET, the challenge has been stalled for over a 12 months as Russian companion Kalashnikov and the Indian Ordnance Manufacturing unit Board (OFB) couldn’t current an inexpensive pricing plan.

Sources mentioned that if the costing committee works as deliberate, the manufacturing unit may get commissioned by October this 12 months, forward of a deliberate bilateral summit between Russia and India. The challenge has excessive precedence on the bilateral agenda since an inter-governmental settlement was signed in January final 12 months.

Whereas the bid submission was initially slated for June 2019, the OFB sought 3-Four extensions of the identical, till November 2019. On the latter’s request, the DAC additionally added a Worth Variation clause hoping that this is able to assist convey down the value of the rifles.

A separate quote was hunted for the preliminary 1.2 lakh rifles and for an additional 70,000 rifles which had been to be 100% indigenously manufactured –– the latter would type the bottom value below the Worth Variation system for the remaining 4.eight lakh rifles.

The three way partnership sought 4 extensions to submit the bid, which lastly got here in February 2020. Nevertheless, on examination, the value bid was a lot greater than the benchmark, contemplating the price of such rifles manufactured by OFB in addition to imports.

It was felt that this was unreasonable and never acceptable and the OFB was nudged to submit a extra affordable supply, which didn’t occur. Due to the nationwide significance of the challenge and the inordinate delay over it, provisions from the Defence Procurement Coverage 2016 have been invoked now to finalise it expeditiously.

Accordingly, a costing committee was set as much as repair a good value for the manufacture of the rifles –– its fundamental model ––conserving in thoughts the 100% indigenisation price of Indian parts.

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