Why Indian Army’s $8 bn Future Infantry Combat Vehicle (FICV) project continues to be stuck in uncertainties

Uncertainty continues to loom over the fate of the $8-billion (approx Rs 60,000 crore ) Future Infantry Combat Vehicle (FICV) project for the Indian Army which was expected to be decided last month. The private sector companies including the L&T, Mahindra and Mahindra, and others have sent in their proposals to the Ministry of Defence (MoD) for the project which has been shifted under the ‘Make II’ category in an effort to involve the private sector in the defence sector to get more active in Make in India initiative.

Sources have confirmed to FE ONLINE, “No decision has been taken and the file has been sent back to the Indian Army Headquarters to decide how they would want the project to go forward.”The shifting of the project under the Make II category was taken last year in an effort to expedite the process, and to promote the `Make in India’ initiative of the government in the defence sector.

As has been reported earlier, there have been differences of opinion between the Indian Army –the user and the MoD which has decided to put the critical programme under the Make-II category. “The main issue where there is divergence of views is that the MoD wants the Indian Army to pay for this project,” said a senior officer on condition of anonymity.

With this delay, sources pointed out that “No forward movement is expected on the FICV project this financial year.”

Original Equipment Manufacturers (OEM) including US-based General Dynamic, Russian companies under the umbrella of Rosoboronexport, and German Rheinmetall are some of the companies keen on being associated with the FICV project, which is to be `Made in India’ and have minimum 40% indigenous content.

Earlier, the FICV project was approved under the strategic partnership (SP) model for the armoured vehicle segment was considered under the ‘Make’ category under DPP-2008.

In 2018, The FE was the first to break the news that that the FICV project will be shifted to `Make II’ category, which was later confirmed by the Defence Secretary at the annual presser in 2018, that the project was moved to that category in an effort to fast track it.

Under the Make II category no funding is required from the MoD, unlike the ‘Make’ category, where the ministry has to provide 90% of funds up to the prototype stage. Make-II (industry funded) — was introduced with a major focus on development of equipment/ system/platform or their upgrades or their subsystems/sub-assembly/assemblies/components. In this subcategory, no government funding is envisaged for prototype development purposes, but there is assurance of orders on successful development and trials of the prototype.

About 2,600 FICVs — high-tech complex vehicle programme under the ‘Make’ category —as 2,600 FICVs with a life span of 32 years, are expected to replace the Army’s old Russian-origin BMP-2 infantry combat vehicles by 2025.

Source:- FE