The Parliament's National Security and Defense Committee decided last week to build the ammunition factory, the Respublika daily reported.
Last year, Lithuania purchased a production line from French company Sofema for manufacturing various caliber ammunition. It was agreed that French experts would also help to install it and train the staff to operate the machinery.
For this purpose, Lithuania took an 80 million litas ($20 million) credit from a French bank under the Lithuanian government's guarantee.
According to the agreements with Sofema, equipment should be delivered to Lithuania and mounted in 16 months, and the plant should start operating two years later.
It is not clear yet where the ammunition plant will be located, but experts think it should be built either in Kaunas, Lithuania's second largest city, or somewhere near it.
The Lithuanian Weapons Fund intends to allocate about 12 million litas to the factory and said it expected to receive another credit with Sofema's assistance, if needed.
Experts say that the ammunition manufacturing line would not help to save great amounts of money, but it would help the country's strategic purposes - Lithuania would be able to provide itself with cartridges.