NEW DELHI - In the biggest-ever order for India's private sector, Larsen & Toubro (L&T) has won a $700 million contract to produce 100 tracked 155mm howitzer guns at Indian facilities, jointly with Samsung of South Korea, for use by the Indian army.

The contract is likely to be inked with L&T in the next two months as all formalities are completed, said an official at the ministry of defense here.

The L&T-Samsung team, offering the K-9 Vajra-T gun, beat an offering for the 2S19 MSTA weapon from Rosoboronexport of Russia.



"More than 50 percent of the work share is with L&T," a senior L&T executive said. Samsung will supply the turret of the gun. The weapons will be produced at L&T's newly set up manufacturing facilities near Pune in central India.

Besides the 100 guns to be produced, the company hopes to close additional deals to boost what analysts say is a slim profit margin on a relatively small number of howitzers. "In case the gun is found attractive and the users [Indian Army] are happy with the performance of the supplied product, it is possible that the self-propelled wheeled program, which is also under planning stage, could get merged and this could increase the total numbers," one company executive said.



A senior Indian army official, however, said the 100 weapons are what's operationally required by the ground service, suggesting the number is unlikely to increase.

No executive from Samsung was available for comment.



Samsung may be hoping for a large market with at least 250 to 300 guns, says Rahul Bhonsle, retired army brigadier and defense analyst. Though the market size is about 250-300 for tracked guns in the long run, Bhonsle said "huge budgetary constraints" may leave the number at 100 in the near term.