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India drops $500m missile deal with Israel on eve of Netanyahu visit

India's Ministry of Defence reportedly pulls out of negotiations to work with a local arms producer as part of its Make in India initiative
The Indian Defence Research and Development Organisation has been asked to develop anti-tank guided missiles (AFP)

India has dropped plans to buy anti-tank missiles worth half a billion dollars from an Israeli company, according to Indian media reports.

India's Ministry of Defence reportedly pulled out of negotiations over the missiles in a bid to foster its own arms industry.

However, the government still agreed to buy $70m worth of Barak missiles, a type of surface to air missile, from Rafael.

Israeli arms company Rafael confirmed in a statement on Tuesday that the anti-tank deal was called off, the Israeli-based Kan website reported.

Rafael also said in the statement that a final deal had not been signed, but that its sale of Spike missiles "met all of India's requirements".

"Rafael regrets the decision and remains committed to cooperating with the Indian Ministry of Defence and to its strategy of continuing to work in India, an important market, as it has for more than two decades, to provide India with the most advanced and innovative systems," the company said.

The Indian government's Defence Research and Development Organisation (DRDO) has now been asked to develop anti-tank guided missiles for the army's infantry as part of its Make in India plan, sources told the Hindustan Times on Tuesday. 

Indian officials were not available to comment at the time of writing. 

Netanyahu visit  

The announcement comes before Israeli Prime Minister Benjamin Netanyahu is due to lead a delegation of businesspeople during a four-day official state visit to India later in January.

Among the Israeli businesspeople who will be joining Netanyahu in India will be Rafael CEO Yoav Har Even, alongside other defence industry leaders from Israel. 

The countries have grown closer since Indian Prime Minister Narendra Modi rose to power in 2014, broadening commercial cooperation beyond their long-standing defence ties.

Modi became the first sitting Indian prime minister to tour Israel last summer.

Netanyahu will be the second Israeli prime minister to visit India (AFP)
During his visit, Modi extended an invitation for Netanyahu to visit Israel and agreed to strengthen bilateral ties between the two countries.  

Netanyahu will be the second prime minister to visit India after diplomatic relations were established between the two sides in 1992.

His visit will be 15 years to the day after former Israeli prime minister Ariel Sharon visited India in 2003. 

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