A four-year-old Indian weapons company has emerged as the lowest bidder for a contract to upgrade a small number of Indian Army’s AK-47 assault rifles, beating off competition from an established Israeli rival and getting a toehold in the Indian small arms market, officials familiar with the development said on Sunday.

Bengaluru-based SSS Defence has edged out Israel’s Fab Defense that produces tactical equipment and weapon accessories, and has upgraded Kalashnikov rifles for the Indian Army, said one of the officials cited above. SSS Defence is a manufacturer of small arms, ammunition and weapon accessories.

The Indian firm will upgrade an initial lot of 24 AK-47 assault rifles held by an army unit under the Jaipur-based South Western Command, with more orders likely to follow, said a second official.

SSS Defence’s AK-47 retrofit system covers tactical flashlights, laser sights, flash hider, dust cover, hand guards and a variety of grips, the official added. “The upgrade will make the AK-47 more lethal and a little easier to work with,” he said.

The AK-47 retrofit systems have met the army’s exacting requirements. They are capable of being used across all AK-47 platforms in service with the army including those of Russian, Romanian, Bulgarian, Polish and Czech origin.

Experts said the development would provide thrust to the Make in India initiative at a time when the government has sharpened its focus on promoting self-reliance in the defence manufacturing sector and positioning itself as an exporter of military hardware.

The AK-47 is a basic weapon and requires modifications to improve its capabilities, said former Northern Army commander Lieutenant General BS Jaswal (retd).

“An Indian firm upgrading the weapon is a great leap forward, given that indigenisation is a top focus area for the government. It will also result in savings,” Jaswal added.

The government has taken a raft of measures to boost self-reliance in the defence sector over the last two years. These include raising foreign direct investment (FDI) in defence manufacturing, creating a separate budget for buying locally-made military hardware and notifying two lists of weapons/equipment that cannot be imported.

India has set aside ₹70,221 crore this year for domestic defence procurement, accounting for 63% of the military’s capital budget. Last year, the ministry spent over ₹51,000 crore, or 58% of the capital budget, on domestic purchases.

On October 15, Prime Minister Narendra Modi said one of the country’s key goals under the Atmanirbhar Bharat (self-reliant India) campaign was to emerge as one of the most powerful militaries and develop a modern defence industry in the country on its own steam.