Dunlop John, or the British Bazooka

The BEF actually had a HEAT rifle grenade too, didn't they? It was (foolishly) directed to be fired from above, like mortar, however. The same tech combined with rocket propulsion could be... tasty.
The No. 68 grenade which had a 2.5-inch diameter and weighed 2 pounds... nope, don't know what you're talking about. :p Actually, it didn't enter service until November 1940 anyway.
The British army used the 2" mortar and replaced it with the 51mm mortar, they then decided to phase it out and replace it with 40mm grenade launchers. However they found that while the GL was a useful tool, it simply wasn't a full replacement which is why they purchased US 60mm mortars to give the infantry an organic indirect fire weapon. Much better to bite the bullet and either reduce the number of riflemen in a platoon or increase the size to add a mortar team.
In OTL, the 2" mortar entered service in 1937 (assuming we neglect the Mark I that came in in 1918, and went straight back out in 1919) as a way to give platoons more firepower than a rifle grenade.

TTL, the Dunlop was created instead; the indirect fire gap still exists, as does the ability to reach beyond 200 yards (the 2-inch was good to 500 or so). Since the 2-inch mortar was never in service, nobody feels the lack of it just yet. Ideally, the platoon would have a mortar team and a rocket team, yes - but the prewar funding environment made it a case of one or the other. By the end of the war, the British Army had both... and whilst the PIAT as we know it is going to be stillborn, its' story isn't irrelevant. ;)
 
The BA was looking for a small portable mortar and tested a number of such weapons throughout the early 30's before settling on the 2". The infantry would be very reluctant to take an unproven weapon type over an obviously useful mortar capable of indirect fire also capable of firing illumination and smoke rounds.

A rifle platoon was made up of a HQ section (5 man) and 3x 8 man rifle sections for 33 men total. In April 1940 they concluded that the manning level was too low and they added an additional 9 men to the platoon (3 men per rifle section), even so it was considered too lacking in firepower to be really effective.

The utility of a rocket weapon (without an anti-tank capability) at this time is not that obvious. Even if you add a shaped charge warhead the Royal Artillery mafia would try to claim they should have it, in much the same way they resisted allowing the PBI having their own 2 pounder AT guns. Ironically the infantry did get the 6 pounder AT guns later.

A direct fire rocket weapon would be a useful addition to an infantry section but I think only as an addition not instead of something else.
 
The BA was looking for a small portable mortar and tested a number of such weapons throughout the early 30's before settling on the 2". The infantry would be very reluctant to take an unproven weapon type over an obviously useful mortar capable of indirect fire also capable of firing illumination and smoke rounds.

A rifle platoon was made up of a HQ section (5 man) and 3x 8 man rifle sections for 33 men total. In April 1940 they concluded that the manning level was too low and they added an additional 9 men to the platoon (3 men per rifle section), even so it was considered too lacking in firepower to be really effective.

The utility of a rocket weapon (without an anti-tank capability) at this time is not that obvious. Even if you add a shaped charge warhead the Royal Artillery mafia would try to claim they should have it, in much the same way they resisted allowing the PBI having their own 2 pounder AT guns. Ironically the infantry did get the 6 pounder AT guns later.

A direct fire rocket weapon would be a useful addition to an infantry section but I think only as an addition not instead of something else.

I have to agree - the 2" knee Mortar is just too useful for a platoon especially in an army expecting to operate at night (illumination and smoke etc).

If this weapon could prove to be a better weapon than the Boys then let it replace that - a man portable weapon (I'm thinking of this as an RPG 2?) that can fire an HE 'grenade' or an AT 'grenade' to 200 m is going to be more useful IMO than the Boys ATR (which in 39/40 is still useful vs light tanks and armoured cars)

As for firepower etc - My understanding was that the infantry Section was supposed to get a 2nd Bren gun but this never happened until later in the war due to losses and the rapid expansion of the Army.
 
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