The government has given its final approval to a nearly Rs 5,000 crore deal to manufacture over 5,00,000 AK-203 rifles by an Indo-Russian joint venture at a manufacturing facility in Amethi in Uttar Pradesh, official sources said on Saturday.
The mega deal is expected to be formally announced at a summit between Prime Minister Narendra Modi and Russian President Vladimir Putin in Delhi on Monday, they said.
The Cabinet Committee on Security (CCS) headed by Prime Minister Modi cleared the deal on Wednesday, days after it was given a go-ahead by the Defence Acquisition Council (DAC), the sources said.
"In an endeavour to provide a big boost to self-reliance in defence manufacturing in India, the government has approved the plan for the production of over 500,000 AK-203 assault rifles at Korwa in Amethi," said a source.
Both Russia and India had given in-principle approval for the deal during Defence Minister Rajnath Singh's visit to Moscow last year.
The joint venture is also expected to explore the possibility of exporting the AK-203 rifles.
"The approval reflects the ever-increasing paradigm shift in defence acquisition from buy (global) to Make in India. The endeavour also reflects the deepening partnership between the two countries," another source said.
The 7.62 X 39mm caliber AK-203 rifles will replace the INSAS rifles.
AK-203 assault rifles, with an effective range of 300 meters, are lightweight, robust and easy to use and they are expected to enhance the combat potential of the troops.
The project will be implemented by a special purpose joint venture called Indo-Russian Rifles Private Ltd (IRRPL). It has been created with erstwhile OFB (now Advanced Weapons and Equipment India Limited and Munitions India Limited) of India and Russia's Rosoboronexport (RoE) and Kalashnikov.
The two sides are also likely to wrap up the final phase of negotiations for a logistics support agreement which is likely to be signed either during the two-plus-two talks or at the summit.
India and Russia are also set to renew for the next decade a framework for military-technical cooperation at the summit besides announcing a joint commission on technology and science.
The two sides may also firm up a number of defence procurement proposals besides deliberating on the long-pending project for joint production of 200 twin-engine Kamov-226T light helicopters for Indian armed forces.
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