The Ministry of Defence (MoD) is planning to place yet another multi-million dollar order with BAE Systems Inc for purchasing 500 more M777 ultra-light Howitzer guns. This is even as it is all set to sign the pending sale of 145 gun-pack with the UK-headquartered defence major.

Apparently, the Ministry has already expressed its interest to procure 500 pieces for the Indian Army from BAE Systems, according to official sources. However, commercial talks are yet to begin.

On the other hand, the long-pending deal to purchase 145 pieces of the M777 155mm 39 caliber towed guns is learnt to have already reached its final leg and the contract will be signed by the middle of 2016.

“The Indian Army has a huge requirement for modern Land Systems, both weapons and vehicles, and we are well positioned to help India fulfil that,” John Brosnan, Managing Director (South-East Asia and India), BAE Systems, told BusinessLine .

On the company’s future plans, Brosnan said BAE Systems has a longstanding partnership with Hindustan Aeronautics Ltd (HAL) on ‘Combat Hawk’ advanced jet trainer (AJT).

The AJTs will be utilised to train Indian Air Force (IAF) fighter pilots.

“We are currently exploring new opportunities for BAeHAL, our joint venture with HAL,” he said.

Brosnan said BAE Systems is working closely with the Indian and US governments to support early conclusion of the M777 deal. “The American government is now in the process of finalising the letter of acceptance (LoA) for submission to the Indian authorities and thereafter the deal can be inked.

“The 145 Howitzers will be procured under this deal with the commitment of assembly, integration and testing here in India under the offset policy,” he said.

However, sources said the new LoA includes a revised price of $735-750 million, an escalation of six to eight per cent from the older price of $694 million, which was finalised in October 2013 under the previous UPA regime.

At that time talks did not progress further until the present government cleared it in May.

BAE also plans to set up an assembly plant with domestic defence firms to manufacture the guns in India under the ‘Make in India’ scheme.