spike missile
Spike Missile [Representational image]Wikimedia Commons

India has cancelled a $500 million deal to develop Spike anti-tank guided missiles from Israel, Rafeal Advance Defence Systems Ltd confirmed.

"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," Rafael said in a statement.

Spike is a man-portable "fire and forget' missile in use by 26 countries around the world. Spike can hit moving targets such as a tank, allowing the soldier who fires the missile to quickly move for cover. Spike is said to have been selected by India after complying to all the defence procurement regulations.

"It should be emphasised that the cancellation was made prior to the signing of the contract and despite Rafael's compliance with all the demands," the company said in a statement.

The company recently constructed missile-manufacturing facilities in Hyderabad in joint venture with Kalyani group.

The cancellation comes days before Netanyahu's four-day visit to India starting January 14. Rafael's CEO would also be accompanying Netanyahu during his India visit. The company did not give a reason for the cancellation of the deal.

As per the original proposal, India had planned to acquire the ATGMs for the Army at a cost of $500 million. The defence ministry has been strongly pushing for transfer of technology in procuring various weapons and other platforms from foreign defence majors as part of its broad policy initiative to encourage domestic defence industry, reports PTI.