India will acquire 100 units of the K9 self-propelled howitzers developed by South Korea’s Hanwha Aerospace Co. from Larsen & Toubro (L&T), an Indian engineering and manufacturing company, in a $850 million deal.
Industry sources said on Monday that L&T has agreed to supply 100 units of the K9 Vajra-T – a 155 mm, 52-caliber tracked self-propelled artillery platform – adapted from Hanwha’s howitzer K9 Thunder, to the Indian Army.
The K9 Vajra-T is jointly developed by L&T and Hanwha Aerospace to suit the customized requirements of the Indian Army for operations in varied terrains, including deserts, plains and high-altitude regions.
K9 Vajra-T howitzers will be manufactured in cooperation with Hanwha Aerospace at L&T’s armored plant in Hazira, Gujarat.
The latest deal is the Indian company’s second contract for the production of the weapons systems.
In 2017, L&T won a tender to produce under license from Hanwha Aerospace the first batch of 100 K9 Vajra-T howitzers.
Sources said India’s Ministry of Defense (MOD) has since been in talks with L&T and Hanwha Aerospace to acquire 200 additional howitzers, but MOD has decided to cut its purchasing volume to 100 units.
The final contract for the latest supply deal will be signed after L&T agrees with its Korean partner on production terms, sources said.
“We’re almost there, but we have some fine-tuning to do,” said a Hanwha Aerospace official.
DEAL’S VALUE
The deal’s value agreed between the Indian Army and L&T is estimated at 72.69 billion rupees ($850 million), of which about half will likely go to Hanwha Aerospace given the Korean firm’s role in joint production and its technology transfer, sources said.
The amount Hanwha will receive from L&T could be lower, depending on their discussions, they said.
India purchased the first batch of 100 K9 howitzers for 45 billion rupees in 2017 as part of efforts to bolster its defense capabilities amid border disputes with China.
Of the 100 howitzers, the initial 10 units were manufactured in Korea, while the remaining 90 units were produced at L&T’s plant in India with Hanwha’s technical support.
GROWING GLOBAL PRESENCE OF K9
Hanwha said the K9 self-propelled howitzer holds a global market share of 50-55%, which is expected to increase further if the latest India deal is finalized.
Finland, which signed a deal to buy K9 howitzers from Hanwha in 2017, purchased 10 additional units in 2021. Norway, which signed a similar deal in 2017, bought four more Hanwha howitzers in 2022.
“We also expect other K9 buyers such as Estonia, Poland, Australia, Turkey, Egypt and Romania to buy more from us. Given the sales of ammunition as well as maintenance, repair, and overhaul services, we expect a steady revenue stream,” said a Hanwha official.
By Hyung-Kyu Kim
khk@hankyung.com
In-Soo Nam edited this article.
