India has officially canceled a $500 million defense deal with Rafael to purchase Spike anti-tank guided missiles. The announcement comes less than two weeks before Prime Minister Benjamin Netanyahu is set to visit India. As part of the deal, Rafael was slated to provide India with some 8,000 Spike missiles and more than 300 launchers.
"Rafael has received an official statement from the Indian Ministry of Defense on the cancellation of the Spike missile deal," the company said in a statement. "It should be stressed that the cancellation was done before the contract was signed, and despite the fact that the company fulfilled all its requirements," they added.
"Rafael regrets the decision but is committed to continuing to pursue this important goal, as it has done with great success for over two decades, with a variety of innovative and advanced systems and with a commitment to the Indian Ministry of Defense," it continued.
According to the company, the Spike was selected as a winner for the tender "after a long and lengthy process and according to all Indian procurement rules." It added that the production facility the company opened in August with its local partner Kalyani Group near Hyderabad will not be closed, the Jerusalem Post reported.
Despite the cancellation, Rafael CEO Yoav Har-Even will be joining other Israeli defense industry leaders on Prime Minister Benjamin Netanyahu's trip to India, scheduled for January 14 to 18, according to Haaretz.
Rumors of the cancellation began to surface in November, and India decided to freeze the deal last month. It is still not clear if India will choose to buy the Javelin anti-tank guided missiles or opt for local production. The infrastructure established by Rafael in India will be used for a number of additional projects which cannot be disclosed at this point.
Earlier, India's Defense Minister Nirmala Sitharaman cleared the procurement of 131 Barak Missiles from IAI for $72 million. The Barak Missiles are surface-to-air missiles designed to be used as a ship-borne anti-missile defense system against anti-ship missiles. They were jointly developed by Israel Aerospace Industries (IAI) and Rafael Advanced Defense Systems, in collaboration with India’s Defense Research and Development Organization (DRDO).