Monday, 29 August 2011

Defence Minister Antony says Arjun Mk II will cost Rs 37 crore (US $8 million) per tank


The Arjun Mark II, an upgraded version of the Mark I pictured here, will roll out by 2015, says Antony



Answering a question in parliament today, Defence Minister AK Antony put the price of the Arjun Mk II at Rs 37 crore per tank. The Arjun Mk I had been produced by Heavy Vehicles Factory, Avadi for about Rs 16-18 crore per tank.

The official release about Antony's answer in parliament today to a question on the price of the Arjun is attached below


MARK-II VERSION OF ARJUN TANK
New Delhi: Bhadrapada 07, 1933
August 29, 2011

Limited technical trials with some major and minor improvements on Main Battle Tank (MBT) Arjun Mark-I, as part of MBT Arjun Mark-II, have been carried out by the Defence Research and Development Organisation (DRDO) in the deserts of Rajasthan.

Defence Acquisition Council (DAC) has cleared the proposal for placement of indent for 124 Nos. of MBT Arjun Mark-II on Heavy Vehicles Factory (HVF), Avadi, Chennai. Placement of indent by the Army on Ordnance Factory Board (OFB) is being further processed.

The likely estimated cost of each MBT Arjun Mark-II with ail major/minor improvements will be approximately Rs.37 crore.

The first batch of MBT Arjun Mark-II is likely to be productionised by 2015.

This information was given by Defence Minister Shri AK Antony in a written reply to Shri Naveen Jindal in Lok Sabha today.

30 comments:

Pawan said...

Dear Ajai, i think you are first to show the photos of MK II. Don't you think it is too expensive as almost all other major MBT like Leopard 2 or M1A2 cost around 5 to 6 million only?
Ca you please some other information about its capabilities ?

Hope to hear from you soon...

Mr. Ra said...

When Arjun MK1 is very good, so Arjun MK2 can be expected to be excellent.

Have they maintained the vertically flat turret without slopes. Whatever it is it must be OK.

The total numbers of Arjun MK1&2 with the Army shall be at least 500 to make it look menacing. The prices must be OK considering the price indexes.

Anonymous said...

37 crore/tank. Now the Arjun is comparable to the Abrams, atleast in price.

Now, I am very interested to know what made the price double given that we are making marginal improvements on the existing Arjun? I mean we still have the Kanchan armour, the 120 mm rifled gun, the Renk transmission and the MTU engine. The improvements LISTED would not double the price unless the improvements NOT LISTED are substantial.

So the question is what are NON-LISTED improvements, Are we getting a new engine, depleted uranium armour instead of the Kanchan and an Active threat management system-Shtora or the Israeli ones, not to mention a new transmission (the Renk unit frequently breaks down apparently) missiles that can be fired from the main gun and engine (MTU had doubled the price of the engine 4 years back)?

Mr Shooklaw-If you know the upgrades not being mentioned, please share. If the upgrades mentioned in the article are the most significant ones and there are no signs of the REAL improvements-we would have proved one thing conclusively, i.e. We do not make duds, we make expensive duds.

Anonymous said...

Call me cynical but I wonder how much of 37 crore price tag goes towards lining ministers' / babu's pockets? Probably a non-trivial amount.
I bet over half.

Anonymous said...

@ Anon 03:56
Mr Shooklaw????
124 tanks to be deployed of a heavy 60 tonne tank,operationally deployed regiment Arjun regiment and you still thinking of duds!

The only thing dud seems to be your spelling and brain.

Anonymous said...

Pawan, those are not line of Mark II, those are Mark I, perhaps there are 1 or 2 Mark IIs. Read the caption of the picture on the original post again.

Rahul said...

Non is in better position that you Ajai sir, please throw some light. This 110% increase awfully hard to believe.

Anonymous said...

OK. We will soon have one of the most expensive MBT in our inventory. A MBT which is indigenously produced by cheap labour and raw materials at our disposal. Consider the following price Tag:-
M1A2 Abrams-6.2 M
Merkava - 5.0 M
Al Khalid - 4.5 M
Arjun II - 8.0 M

As per Guinness book of world records the most expensive MBT is of course K2 Black Panther - 8.5 M. However I am sure very soon we will cross that milestone too. I agree, records are meant to be broken.:-)
NRP

Anonymous said...

well finally we could see some serious blogging from u.

Hari Sud said...

At $8 million a piece it is pricy. There must be something wrong here, in what the Defence Minister said and what information he was fed to reach that conclusion.

Anything more than 30% the price of Mark -1 version of $2-3 million is too pricy.

If the subsystem come at a higher price then it should be clearly stated.

Basic Abram Tank is $4 million. Subsystems and spares add another $4 million. Training of crew add another $1 miilion. Hence the only outside buyer of Abram M-1, the Saudis who are not getting brand new but refurbished to new condition are paying $9 million a unit (all inclusive).

Hence if the Indian tank is going to cost $8 million then buy Abrams. US will be delighted to restart production of brand new units instead of refurbished, if the order is large enough.


Hari Sud

Realist said...

$8 million per tank ? Wow!!

The Indian Army seriously needs to test this tank out extensively to justify the cost of acquisition.

Either there should be economies of scale or we should consider changing requirements because $8 million per tank is something that is going to be VERY VERY expensive to replace considering the massive losses any armored thrust across the Western border would likely face.

Plus, it is also important to know exactly what percentage of components in the Arjun are procured from outside India and what is their percentage in the total cost of the tank.

For a developing country like India where every rupee is precious spending $8 million per tank is a luxury we can ill afford, especially if these tanks are going to be the spear point of our strike corps.

Strategically, the Pakistanis can replace their Al-Khalids at a cheaper price than we can replace Arjun Mk-2s. Plus, the Chinese will readily supply the Pakis with tanks on credit and the Chinese can produce far more tanks for a cheaper price and better if not equal capabilities to Arjun Mk2.

Vaibhav Kumar said...

The price is high because of the small production run. The developmental costs are divided into such small number of tanks that price of each tank increases significantly. If ordered in substantial numbers, the price would come down and indigenous production of items like tracks, engines etc would become viable. This high price is not because of bad design but because of bad decision making we shown by those who are responsible for acquisition.

Abhishek said...

Its is more than twice the price of old tank. This implies that the cost of subsytem is now more than 20 crores. (I consider that the basic cost of MK1 remains same why? I compare it with the normal automotive sector)

Also going by current cost it seems that this tank is the costliest tank in the world.

If it is the costliest than they should ensure that it should be the best tank otherwise as per economics they should buy from outside.

sahanshu said...

why do you guys always run after the monetary aspect of projects?

They are strengthening the kanchan Armour-which according to Israelis is the best Armour in the world even the British and the Americans don't have something like that...the Israelis called the arjun mark1 desert Ferrari. God only knows what the mark II would be.
DRDO is using a lot of electronic components which have never been used in India tanks before...so chill this one is gonna be a big Beast.
Ajay sir please throw some light on the Israeli involvement in this tank.

Sam said...

The initial work costs money, its an investment provided we learn and produce items on our own. best of luck designers and supporters of Arjun project.

Anonymous said...

WTF?????

AK said...

That is a very vague statement from the def min as usual. The cost per tank can only be decided if we know the exact number of items being built. If Arjun MK-II is restricted to just a few hundreds, then obviously the price will be higher. However, if we decide to phase out all the old t-series tanks with Arjun MK2 then the cost can come down dramatically. This is a simple law of industrial production. Also, no price is high enough as long as we are totally independent of foreign supplied maal that constitutes 70% of our defence procurement. The total life cycle cost will be much lower for a desi system compared to a crap like the tin cans.

Anonymous said...

well the reasons for the price are simple and if any of you gents do bit of digging you will find that over 70% of arjun is either imported or under licence production...especially all the major components.

Anonymous said...

Guys, The post by Mr Shukla does not mention if the price is inclusive of development costs or just sum of individual prices of components of the Tank. And as any economics guy would tell with more volume the costs tend to come down.
And folks please do not insult your own intelligence by comparing AL-JUNK with ARJUN.

BTW does nay one know what is the price at which our ordinance factories sell woolen socks worn by Armed forces folks(last I heard in 1990's it was 50+ Rs when you could get the same from a Private manufacturer at Rs 2.00
-Raju

Anonymous said...

The whole defence procurement process stinks. Ever since reports from topshot consulting companies came out that India needs to invest $100 bn or more for defence purchases..prices for every defence commodity are simply going up for India for no reason. The $10 bn MMRCA that was considered biggest military deal in forseeable future is now slated to go upto $25 bn.. Suknois are suddenly costing 40-60% more..30 yr old piece of repainted and rechristened aircraft carrier is $3bn plus..Indians are just being taken for a ride..including Indian Defence PSO it seems.. Arjun is a great tank but at $8 mn a piece..makes much more sense to get 2+ T90 at same price and invest in Depleted Uranium armour and ammo. The game chamger is not a steel beast that can be taken down by some well aimed RPG costing few hundred dollars..but Uranium depleted Ammo, Uranium depleted Armour, Active protection system like trophy. Without them tank is just a good $8mn target for pakis and they have invested well in anti armour missles just for that.In any case , in real war they will just flood the punjab plains near Lahor as they did in 65 and make tank movement painful and tanks easy to shoot. In a war of attrition..any weapon that costs double what the enemys cost and is easy to kill is just just inviting defeat...

kulari94 said...

I'm pretty disappointed with the comments on the blog. The Arjun I beat Russia's best tank, the T90, in trials. Neither the Chinese nor the Porkis have anything that is substantially better than the T90. This is the Arjun II, which is a significant improvement over Arjun I, which is better than the T90. Further, the time to come up with the Arjun II was significantly less than the time spent to produce the first version. If the price reflects an appropriate market value for the raw materials and services rendered, and the Mark II is substantially better than the Mark I, the price is justified, even if it is the most expensive tank. I can't believe the comments that there must be corruption involved. My fellow Indians need to rid themselves of this knee jerk reaction whenever they have an objection. However, I do think that it is a reasonable inquiry to ask that the price be explained. The main inquiry should not be price, however. The focus should be on quality. If the quality is there, the price can be worked on. However, if the quality is not there, and the tank is a piece of shit, what good is it if it is very cheap?? The price should be evaluated in light of the short time it took to produce the Mark II, and the quality of the Mark II. As the saying goes, you get what you pay for!!

Realist said...

@Raju -31 August 2011 02:54

There is absolutely no reason in the world not to compare the price of an Al-Khalid tank with the Arjun.

You and DRDO both claim that the Arjun is much superior, so what ? The Tiger-2s were also superior to the T-34s in WW2 but the T-34s kicked the Tigers up and down Europe with their overwhelming numbers and the speed and cost at which they were replaced.

War is as much about money as it is about killing. Only the arrogant ever dismiss their enemy's weapons as "junk". A modern ATGM costs about $25,000 and even at two ATGMs per tank, the enemy risks less soldiers, lesser resources fighting our tanks compared to the risk of exposing 4 heavily trained men and $8+ million dollars worth of tank and munitions. This is definitely worth pondering about.

Mr. Ra said...

The inordinate delay of Arjun MK1 has ultimately turned out to be a boon in disguise. If Arjun were to arrive in year 2000, then it would have been like an advanced Vijayanta only and difficult to swallow and develop.

Thanx to the advanced technological environment now and thanx to the Lebanon war of 2006 that Arjun MK1&2 have solid lessons from Merkava being hit by RPGs and for inclusion of Shtora like active protection suites etc.

Such hyper tanks now deserve to be costlier due to inclusion of hyper technologies, import contents, economic inflation etc. However their pricing audit may need to be done to remain over the board without hampering their progress and inclusion.

Anonymous said...

37 crores is too much for structural Modifications and other..

Army Should have ordered at least 500 MK2 to minimize price per unit..

Further DRDO era tech needed to be updated..

vishakh said...

http://trishul-trident.blogspot.com/2011/04/arjun-mk2-mbt-emerges.html

Read this all info about MK2 ARJUN and why is so costly .....

Anonymous said...

Realist @ 31 AUGUST 2011 12:17
Who said tiger -2's were superior to T-34?? Tiger had too many problems when you compare that to T-34. T-34 was Russian Armour at its best. And not only that the Tiger had lots of problems when it came to climate, its engines, and availability of spare parts. More or less you could call it a hanger queen of world war 2. things have changed a lot since WW2, when 1:10 ratio of superiority would win wars for you has gone to 1:25, quality, precision and rate of fire matters.

For example, when Germany produced around 5000 tanks, US produced about 55,000 Tanks and i think russia produced as many. Do u think porkies can match those numbers???

War is as much about money as it is about killing. Only the arrogant ever dismiss their enemy's weapons as "junk". A modern ATGM costs about $25,000 and even at two ATGMs per tank, the enemy risks less soldiers, lesser resources fighting our tanks compared to the risk of exposing 4 heavily trained men and $8+ million dollars worth of tank and munitions. This is definitely worth pondering about.
Looks like with you at the helm of managing paki army affairs, India need not even worry about winning wars. The thing Mr. realist is that on Arjun MK2 we are going to have reactive armor tiles and also active protection system from Israel. the scenario that you speak of might be a possibility in Urban warfare but not in Open ground warfare as in Indo paki war. And not only that with an Open ground war Soldiers tend to follow Armor and that would decrease the chance of your scenario.

Realist said...

Anonymous @ 1 September 2011 08:15

[b]Who said tiger -2's were superior to T-34?? Tiger had too many problems when you compare that to T-34. T-34 was Russian Armour at its best. And not only that the Tiger had lots of problems when it came to climate, its engines, and availability of spare parts.[/b]

You are talking about the Tiger-1 and I was referring to Tiger-2. The differences are ENORMOUS! Plus, Tiger2s were FAR FAR superior to the T-34 in every possible way technically and this is what everybody know about the tanks says- including the Soviets of the time. But the Tiger-2 didn't help Germany win the war nor did it in any significant way slow down Soviet armor, which is my point exactly.
What has changed is, the Porkies don't need 50,000 or even 5000 when they can just nuke an entire division amassed at the border. Numbers are irrelevant in the post-nuclear age as strategically the resources needed would be put to better uses like acquiring better and more potent nuclear delivery mechanisms. The Pakistani armor doctrine would be almost entire defensive in nature just like NATO's armor policy against the Soviets, with tactical nukes countering any offensives. Numbers matter only to India as it is going to be the aggressor and it is India that needs to be smart enough to see that a tank costing $8 million is just a ridiculous waste of scare resources for something that is most likely never going to be used!
[b]Looks like with you at the helm of managing paki army affairs, India need not even worry about winning wars. The thing Mr. realist is that on Arjun MK2 we are going to have reactive armor tiles and also active protection system from Israel. the scenario that you speak of might be a possibility in Urban warfare but not in Open ground warfare as in Indo paki war. And not only that with an Open ground war Soldiers tend to follow Armor and that would decrease the chance of your scenario.[/b]
Yes, with me at the helm of the Paki Army, India need not worry about winning wars as they would be too busy trying to stave off bankruptcy and destitution, thanks to naive policies of the fiscally irresponsible.
Reactive armor tiles and active protection systems are meaningless because it is far more easier and cheaper to destroy a tank- any tank than it is to protect it! Even a illiterate mujahideen can blow up ANY tank with a modern ATGM, while it takes years of training and a whole of lot of money to train a single tank crew!
The Soviet style combined arms armored battle groups would only present a much bigger reason to take the nuclear war to a tactical level- just as it did to NATO! And the scale of losses should this happen would be FAR more for India than what it would be for an enemy that relied less heavily on expensive armor that was dispersed more widely.

Anonymous said...

I think the excessive price has also to do with the production nos.The M1s,the leopards,the T -series come from established and long lines.The Korean and Japanese MBTs too are priced accordingly and both stress on local/indigenous productions lines with orders in a few 100s .The Korean K2 is about 8.5 million $ while the Japanese Type 10 is a real whopping 11 Million dollars/unit.

Karthik Soundarajan said...

Pics, Pics, Pics please..! We have been wondering how an ERA fixed Arjun would look, if it all there are any physical changes?

Anonymous said...

PLZ SHOW HOW ARJUN MK2 LOOKS LIKE