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Bofors’ FH-77B05:
Winner by default?

As noted in an earlier article today, BAE Systems Land and Armaments is offering the Bofors FH-77B05 towed 155mm artillery piece an an option for Australia’s Land 17 program.

The FH-77B05 is also competing against the Israeli Soltam TIG 2002 and the South African Denel G5/2000 gun, for India’s $2 billion purchase of about 400 155mm self-propelled howitzers. These weapons are intended to outrange and outshoot Pakistan’s self-propelled M109 155mm guns.

Competition Background

Bofors Archer System
(click to view full)

All three competitors failed to meet India’s accuracy specifications in 2003 trials, but all three improved their guns to compete again in 2004. The Soltam howitzer experienced some technical issues, and the South African firm Denel is currently under corruption investigations related to the India contract. This may be particularly unfortunate for Denel, as The Times of India reports that the contract may even be critical to the firm’s financial survival.

Bofors Defence AB, meanwhile, was once blacklisted by India after allegations of kickbacks in a 1987 deal during Rajiv Gandhi’s regime.

US-India Defense and Strategic Affairs reports on the competition, and notes that this is expected to be one of the first large defense procurement decisions made by India’s new United Progressive Alliance government. DID has noted the extreme risk-averse behavior of India’s defense procurement establishment and its effects on contract awards, however, and Defense India notes that when a competition devolves to a single-vendor solution, the practice is often to re-tender.

UPDATES:

Soltam Rascal
(click to view full)

April 4/07: Re-tender is exactly what happened. Sujan Dutta of The Calcutta Telegraph reports that India has reopened its artillery competitions entirely, refloating 2 global RFPs to 12 makers of 155mm/52 calibre self-propelled guns. The Indian Army reportedly proposes to buy 400 systems at the outset: 180 tracked and 220 wheeled.

The first new tender was for wheeled guns, with an RFP floated in early March 2007. The second tender for tracked guns was floated at the end of the month. Expected competitors include BAE Land Systems USA (M109A6 Paladin possible in tracked), BAE Bofors (FH77B towed, Archer wheeled), France’s Nexter (Caesar wheeled), Rheinmetall (Zuzana wheeled from Kerametal in Slovakia, possibly PzH-2000 tracked), Korea’s Samsung Techwin (K9 tracked), and Israel’s Soltam (Atmos 2000 wheeled, Rascal tracked).

• A single-vendor situation must be avoided;
• South Africa’s Denel had emerged as the single vendor for the tracked version, but they were blacklisted in 2005 on another deal;
• The process delays of 5 years since the first tender have been so great that the field as a whole has advanced since then;
• The standards for the selection of the guns need to be revised; and
• India’s defence procurement policy has been revised, and the RFP should reflect that.

Jan 16/06: A new scandal is swirling around re-opened allegations of kick-backs involving Bofors, and complicity by the current government in covering them up.

Jan 13/06: PTI news service reports that Army Chief General J J Singh has ordered a fourth round of extensive trials for the guns, in which only the Bofors and Soltam guns will be taking part. He said the two contending 155mm/52 caliber guns would be evaluated through summer and winter trials, with the winner inducted by 2007. DID thinks that may be a bit optimistic...

July 28/05: South African competitor Denel is blacklisted from Indian defense contracts as a result of the CBI bribery investigation by the Ministry of Defence