Price war over Akash missile? (Updated)

This is something I've heard from three separate senior folks in the Indian Air Force, but haven't been able to get an official confirmation yet on it. Word has it that the IAF has conveyed its displeasure to the Defence Ministry and DRDO (creators of the Akash) over the price quoted by the five-firm consortium led by Bharat Dynamics Ltd (BDL) that will build Akash missiles for its first order. The IAF's initial order for a squadron of Akash systems is understood to be worth around Rs 1,975 crore.

The other companies that will carry out the contract are L&T, Tata Power, Bharat Electronics Ltd (BEL) and Walchandnagar Industries Ltd.

UPDATE: Just spoke to folks dealing with the Akash induction programme in the air force, and have got an unofficial stand on what the issue is. The IAF has signed on the dotted line for a squadron of Akash missiles, but it has represented to the MoD formally that in its present form, the Akash does not meet certain qualitative requirements set down (manoeuverability), nor have some capabilities been satisfactorily demonstrated by DRDO, including the engagement of low-level targets. It has therefore asked that the unit price of the missile system be brought down by a specified percentage to make up for the shortfall in desired capability.

However, DRDO has represented to the Ministry that the IAF's current order -- preferably for two squadrons of Akash -- go through without a hitch, so that IAF-specified refinements can be brought into follow-on orders of the system. The run-in has apparently turned quite nasty. I don't know why, but I have a bad feeling about all of this. Why does the IAF have absolutely no problems forking out unreasonably large wads of cash for Russian and Israeli systems? And why do treacherous mid-stream price hikes by the damn Israelis and Russians not raise a cheep from our armed forces? This is bad news, and shouldn't be a trend. Indigenous programmes being finished off just when they're complete is becoming a trend.

For all Akash features on LiveFist, click here. For LiveFist's exclusive photo-feature on the successful Akash missile tests of December 2007, click on the following:

EXCLUSIVE: Akash final trial photos
More Akash photos
Even more Akash photos
And, a final batch of Akash photos

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