/ 25 June 2004

Uphill battle for Denel in India

State arms maker Denel’s campaign to sell artillery to India is in danger of failing, a report in an influential United States defence journal says.

DefenseNews reports that a hybrid self-propelled gun mating Denel’s T6 turret with an Indian-made Arjun main battle tank (MBT) chassis ”is not successful”.

The T6 is a self-contained 155mm artillery turret that is meant to fit the turret ring of any modern MBT with a minimum of modification. The Arjun has been under development since 1974. The programme has been beset with problems — the tank should have been operational in 1984.

DefenseNews said the Arjun’s developers, the Defence Research and Development Organisation, declined to comment on the report.

It was not clear from the report whether the problem lay with the Arjun hull or with the T6 turret.

Denel is also facing an uphill battle in its efforts to sell the Indians its G5/2000 towed gun.

India has a stated requirement for around 400 of the 155mm systems under a contract worth $2-billion (R12,46-billion).

The G5 is competing against the Swedish FH77B05 and Israel’s TIG2000.

All three failed to meet Indian accuracy specifications last year.

DefenseNews added that India would buy 180 guns immediately and produce the rest under licence.

An official was quoted as saying that the Indian army had plans to buy up to 1 500 in the next seven to 10 years to convert all its artillery to the 155mm calibre.

It added the decision will be the new Congress Party-led government’s first arms procurement decision.

The party, still associated with Mahatma Gandhi, was voted out of office in 1989 in the wake of a massive corruption scandal involving the purchased of 410 FH77s from Sweden.

The guns subsequently proved their worth in the 1999 battles in the Kargil mountains against Pakistan-supported Kashmiri insurgents.

The DefenseNews report comes against a background of labour unrest at the state-owned arms maker as well as an ongoing campaign against corruption, duplication and waste that has seen the company suspend senior managers, slash advertising and cut back its presence at defence shows.

Denel workers protested at the group’s Pretoria head office earlier this week against the company’s failure to implement a 2003 industrial bargaining council wage agreement Denel says it cannot afford.

Denel has vigorously denied industry speculation that it was to post a R800-million loss for the financial year that ended in March.

Spokesperson Sam Basch said the company was still compiling its financial reports and he was at a loss to understand how the R800-million figure could be arrived at. – Sapa