US finalised proposal to sell M777 howitzers to India for over $700 million; deal to involve 'Make in India' component

NEW DELHI: The US has finalised a proposal to sell M777 ultra-light howitzers to India under a direct government-to-government deal, with Washington expected to send a formal 'Letter of Acceptance' this week. The light artillery gun deal, worth over $700 million, will also involve a significant ' Make in India' component with Mahindra expected to bag a major share of the work contract.

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Sources have told ET that the LOA, which is the final step from the US in a Foreign Military Sales (FMS) contract like this, has been finalised and is to be presented to South Block this week. This would be followed by an acceptance from the Indian side and subsequently transfer of an advance after which deliveries of 145 guns would commence.

At least two M777 light howitzers are expected to be delivered to India this year as part of the deal so that the army can generate its 'range tables' – a calibration for the various types of Indian made ammunition that the guns would fire once in service.

The deal for M777 howitzers under the FMS route has been in process since 2008 and has seen several ups and downs, including the possibility of being scrapped. The contract was revived last year by the Modi government under a new deal that included a Make in India component.