The Indian Army has awarded a ₹17 crore contract to Hyderabad-based Lokesh Machines, a company currently under US sanctions, for the supply of 'Mod Kits' for the 7.62mm Medium Machine Gun (MMG).

Lokesh Machines, founded in 1983, is a well-established manufacturer of CNC machines and has expanded into small arms manufacturing, notably developing the indigenous submachine gun Asmi for the Indian Army.

Despite being sanctioned by the US Treasury Department due to allegations of shipments to Russia and ties with Russian defence procurement, the Indian government and the Ministry of External Affairs have stated that Lokesh Machines did not violate any Indian laws. The company is actively seeking removal from the US sanctions list and continues to supply critical arms and components to Indian defence forces.

Lokesh Machines earned significant recognition for successfully developing and manufacturing the Asmi submachine gun, which was inducted into the Indian Army earlier this year with a supply of 550 units to the Northern Command.

This indigenous weapon was designed in collaboration with the Indian Army and the Armament Research & Development Establishment (ARDE) Pune, eventually outperforming internationally renowned competitors. The recent contract for 7.62mm MMG Mod Kits underlines the company's growing importance as a domestic defence supplier despite international challenges.

The US sanctions on Lokesh Machines stem from the US government's allegations that the company facilitated exports of machinery to Russia, linked to Russian defence manufacturing. In response, Lokesh Machines has stated that it was neither directly notified by the US Treasury nor contacted prior to the sanctions and has sought clarification and removal from the sanction list via legal channels. 

Concurrently, the Indian government is engaging with US authorities to resolve the issue, emphasizing compliance with national laws and support for defence-oriented indigenisation efforts.

The ₹17 crore contract award demonstrates the Indian Army's continued commitment to domestic defence suppliers and the strategic importance of Lokesh Machines, especially given its track record with indigenous weapons like Asmi.

The contract for 'Mod Kits' for the 7.62mm MMG signifies ongoing modernization and enhancement of infantry weapons, a crucial element of the Army’s equipment upgrade plans. Lokesh Machines’ capabilities in defence manufacturing, coupled with government backing, position it as a key player in India’s efforts to boost indigenous production even amidst international sanctions.

While Lokesh Machines is under US sanctions linked to alleged Russian ties, it remains a vital domestic defence supplier to the Indian Army, recently securing a ₹17 crore contract for 7.62mm MMG Mod Kits.

The company is actively pursuing de-listing from US sanctions and enjoys support from the Indian government and Defence Ministry as it bolsters indigenous defence manufacturing capabilities. This contract reflects both Lokesh Machines’ resilience and the Indian Army’s focus on leveraging domestic industries for critical military supplies.

IDN (With Agency Inputs)