Tatas Set to Bag . 1kcr Army Contract Contract with the Defence Ministry ends Czech-made Tatra trucks’ monopoly over supplying high-end military vehicles Tata Motors is in the final stages of concluding a . 1,000 crore contract with the ministry of defence for the supply of 1,239 heavy duty trucks, in a move that will herald the end of a decades-long monopoly Czech-made Tatra trucks enjoyed in supplying the military’s high-end vehicles. The deal for the so-called sixwheel-drive high mobility vehicles (HMV), fitted with material handling cranes, has the option of a follow-on order for 600 more units, a senior company executive said. This deal is among the three procurement projects the defence ministry kicked off last year involving specialized trucks. “We have been out of this category for 30 years. We had to get into this. This is the future,” said Vernon Noronha, vice president, defence and government business at Tata Motors. He said the company expected to conclude the deal in a few days. In November last year, the company had emerged as the lowest bidder, beating three other contenders—Vehicles Factory Jabalpur with Ashok Leyland, Force Motors with MAN SE and BEML with Tatra. In April last year, ET reported that a consortium of Larsen and Toubro and Ashok Leyland had emerged the lowest bidders in a Rs100 crore contract to procure 100 multi-barrel rocket launchers (meant to replace the Grad BM21 truck-mounted rocket launchers). That deal is still with the contract negotiation committee (CNC), which is the final stage in all defence procurement. The defence ministry is currently holding trials for two other contracts involving trucks—eightwheel-drive high mobility trucks and a specialised platform called the Field Artillery Tractor (FAT). Tata Motors is participating in both. The eight-wheel-drive HMV contract is for 255 units and has an approximate value of . 400 crore, while the FAT contract is for 100 units with an approximate total value of . 80 crore. A defence ministry spokesperson declined to comment. An analyst who closely tracks the ministry’s finances said it was unlikely that the ministry will sign any new contract this fiscal as the finance ministry had made revisions to the defence budget, moving Rs7,800 crore from capital expenditure to revenue expenditure category. This means the MoD is left with little money to spend on acquisitions. “It’s unlikely that the contract will be signed before 31 March. But it is a welcome move. It was a huge anomaly that a country with aspirations of building a nuclear submarine and a fourth generation fighter jet and intercontinental ballistic missiles continued to import trucks. This should have happened 20-30 years ago. This is happeneing now due to the Tatra controversy,” said Laxman Kumar Behera, a research fellow with the Institute for Defence Studies and Analyses. Behera was referring to the federal investigation into Indian army’s purchase of more than 7,000 Tatra trucks from the state-owned BEML since 1986. The controversy erupted after the former army chief General V.K. Singh said that he had been offered bribes to continue buying trucks made by Tatra.
Posted on: Thu, 30 Jan 2014 11:17:30 +0000
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