The Indian defense ministry has decided to spike a half-billion dollar deal to buy anti-tank guided missiles from Israel in favor of making a "home-grown" version, Indian press sources report.

Ishay David, deputy spokesman for Rafael Advanced Defense Systems, told Haaretz that "Rafael has not been officially informed of any change in the decision to purchase Spike missiles." He added that Rafael already "began the transfer of development and manufacturing knowledge as part of the Make-in-India program. This activity will continue as planned."

Surprising some defense industry insiders, India had opted to buy Spike anti-tank technology from the Israeli company Rafael rather America's Javelin system. The deal with Israel was closed in May 2016.

Production was to be done in Hyderabad, by a joint venture Rafael just announced this August, with the local company Kalyani Strategic Systems. However, it seems the Indian government has tapped its own Defence Research and Development Organization to develop a "man-portable" antitank guided missile instead.

The decision may have been driven by Indian Prime Minister Narenda Modi's stated objective of encouraging Indian industry.

Open gallery view Simulation of Spike antitank missile Credit: Rafael Advanced Defense Systems

Deliveries by the joint Israeli-Indian venture were expected to start in 2018. Now development could well take some four years, Zee News reports.

Indian sources surmise the reason is New Delhi's desire to promote weapon development in India, which could be discouraged by importing armaments. It bears adding that the Indian development authority has created anti-tank guided missiles before, the Nag and Anamika.

Just this August, Rafael announced the inauguration of a missile manufacturing plant in India with Kalyani. India had been expected to buy around 8,000 antitank missiles from the plant.

In another sign of the warming relations between Israel and India, Indian Air Force commandos took part in joint exercises with their Israeli counterparts for the first time ever as part of the “Blue Flag” drill, the largest air force exercise ever held in Israel.