BAE Systems has selected Mahindra as its business partner for Assembly, Integration & Test (AIT) facility for the M777 Ultra Lightweight Howitzer.
Leading gun-maker BAE systems said on Wednesday that Mahindra Group would be its India partner for the nearly 700 million dollar deal for the supply of 145 Howitzers for the army.
The M777 howitzers are ultra-lightweight artillery guns with a strike range of 25 km.
The "spares, maintenance and ammunition will be operated through Indian systems", defence ministry sources said.
BAE said in a statement: that it had selected Mahindra as its business partner for the assembly and testing of the guns.
India and the US, where BAE manufactures the weapons, are in discussions for the supply of the howitzers for the Indian Army, it added.
"BAE Systems looks forward to working with Mahindra in the coming weeks to finalize details of this AIT facility and to negotiate the terms of its contractual arrangement," the company said.
New Delhi is trying to replenish its range of artillery weapons.
Last year, BAE developed and submitted a US government-supported proposal offering a higher degree of indigenisation on the M777 weapon system.
The highlight of this is the commitment to establish AIT or Assembly, Integration and Test capabilities in India in partnership with an Indian company.
New Delhi is trying to replenish its range of artillery weapons after years of delays in ordering new equipment for depleted supplies.
Prime Minister Narendra Modi has vowed to upgrade the country's military hardware, but wants deals with foreign companies to include the setting up of factories and plants in India to boost local industry, and the transfer of technology.