The Indian Ministry of Defense has given final approval to a joint venture for the licensed production of more than 600,000 Russian Kalashnikov AK-203 assault rifles. The deal is now valued at around $ 590 million, nearly $ 100 million below the price of $ 688 previously reported by Janes. Citing insiders in India’s defense industry, Russian media outlet RBC said the new assessment would be the result of logistics and supply chain optimizations.
The AK-203 is an export variant of the AK-100 rifle family, chambered in 7.62х39. The Kalashnikov rifle benefits from overall performance improvements over the notoriously unreliable 5.56 × 45mm INSAS (Indian Small Arms System) rifle that currently serves as the mainstay of the Indian armed forces, including lighter weight, longer length. short and modern ergonomics. AK-203 promises to alleviate frequent interference and overheating problems reported by INSAS operators.
“A lot of preparatory work was carried out, during which Russian specialists worked with Indian partners to develop efficient production models,” Bekkhan Ozdoev, industrial director of the Rostec weapons cluster, told Russian media. “This made it possible to optimize production expenses to the tune of several tens of millions of dollars. The agreement covers a total of 680,000 AK-203 rifles. Of these, 70,000 will be delivered from Russia to India within three years. The remaining 610,000 rifles will be produced under license by the Indo-Russia Rifles Private Limited (IRRPL) joint venture, a manufacturing facility located in the town of Korwa in northeast India. These rifles are expected to be produced within ten years. The potential deal would make India the first foreign country to license the AK-200 series of assault rifles. Local production is expected to start in the first quarter of 2022.
Former Brigadier Rahul Bhonsle of Security-Risks, a defense management consultancy in New Delhi, told the Defense Intelligence publication Janes that the contract was blocked by a dispute relating to the payment of royalties. “After months of extensive negotiations, Russia had chosen to waive the royalty clause in the contract in accordance with India’s demands,” Bhonsle said.
New Delhi is a long-time customer of Russian military hardware dating back to Soviet times, but Moscow has always struggled to penetrate the Indian small arms market. Russian defense industry insiders familiar with the negotiations say the joint production agreement is distinguished by “a [degree] location and speed of technology transfer[s]With the company expected to achieve a 70% locate rate within the first thirty-two months, Janes said. All rifle components must be purchased locally within eighteen months.
The AK-203 production joint venture is expected to be formalized during Russian President Vladimir Putin’s state visit to India on December 6.
Mark Episkopos is a national security reporter for the National interest.