India nod for $5.9-billion tender to build next generation submarines

File Photo: INS Khanderi, a Scorpene attack submarine build by MDL in Mumbai with help from Naval Group.

New Delhi: India today approved a navy proposal to float a $5.9-billion tender for locally building next generation attack submarines with foreign help, for which state-run Mazagon Dock Shipbuilders Limited (MDL) and Larsen & Toubro Limited (L&T) are set to compete.

The Defence Acquisition Council (DAC) of the Ministry of Defence gave its go-ahead to the Indian Navy for issuing the Request for Proposals for construction of the six conventional, diesel-electric powered submarines under Project P75(I) through the Strategic Partnership (SP) model of the Defence Acquisition Procedure 2020, according to an official statement.

The DAC, chaired by Minister of Defence Rajnath Singh, also approved proposals for capital acquisitions of air defence guns and ammunition for the Indian Army worth Rs 6,000 crore ($822 million), to be produced by the Indian private sector.

The Acceptance of Necessity (AoN) for the six submarines, with state-of-the-art Air Independent Propulsion (AIP) system, was accorded at Rs 43,000 crore ($5.9 billion) way back in 2015.

The six new submarines will be the first ever acquisition by the Indian armed forces under the SP model. The SP model is at least five years old now since introduced in the defence procurement procedure in 2016 when Manohar Parrikar was India’s defence minister.

“This is a landmark approval, being the first case processed under the Strategic Partnership model. This would be one of the largest ‘Make in India’ projects and will serve to facilitate faster and more significant absorption of technology and create a tiered industrial ecosystem for submarine construction in India,” the Ministry of Defence statement after the DAC meeting said.

“From a strategic perspective, this will help reduce current dependence on imports and gradually ensure greater self-reliance and dependability of supplies from indigenous sources.”


The Indian Navy is also pursuing two more projects under the SP model, for buying 123 Naval Multi Role Helicopters and 111 Naval Utility Helicopters. The Indian Air Force is looking to buy 114 combat jets and the Indian Army 1,770 future battle tanks under the same procurement procedure. The SP model of procurement is touted to be a game changer for boosting domestic defence industrial capabilities.

“With accord of this approval (today, for the submarines), the country will be enabled to achieve its 30-year submarine construction programme envisioned by the government to acquire national competence in submarine construction and for the Indian industry to independently design and construct submarines in India,” the statement said.

“The availability of new technologies and advanced manufacturing capabilities to the industry will be an important step towards enhancing the nation’s quest for self-reliance in modern conventional submarine construction and sustainment activities whilst creating direct and indirect job opportunities in India.”

The Indian Navy said this project, under SP model, provided a unique long-term opportunity and planning certainty for the industry to invest and support submarine construction. “It will also infuse the latest technology and weaponry for submarines in India through strategic tie up between Indian industry and leading foreign OEMs (Original Equipment Manufacturers).”

There is already a four-year delay in issuing the RFP for the P75(I) submarines, as the defence ministry has had to go through a rigorous selection process among the available private shipyards in the country with infrastructure and financial stability to pursue the project.

Only L&T qualified after the scrutiny, causing a single vendor situation, a no-go under the defence procurement procedures. To overcome the impasse, the government decided to allow the defence public sector MDL to also participate in the SP model programme, evisaged for the private sector, as a one-off tender.

Army’s Air Defence Guns

There was a long pending need of the Indian Army for modernisation of its Air Defence guns. These had been earlier procured only from foreign sources. With the continued thrust of the defence ministry towards ‘Átmanirbhar Bharat’ and ‘Make in India’, an enthusiastic response from about a dozen Indian companies was received to produce air defence guns, according to the defence ministry statement.

“All of them have expressed their willingness and commitment to manufacture this complex gun system and associated equipment by ensuring technology assimilation in India. Accordingly, the DAC accorded approval of procurement of Air Defence guns and ammunition at an approximate cost of Rs 6,000 crore under the Buy & Make (Indian) category,” the statement said.

Further to better equip the Armed Forces to meet the operational challenges and facilitate faster induction of required arms and ammunition, the DAC extended the timelines for progressing urgent Capital Acquisitions under the delegated powers to the armed forces up to Aug. 31, 2021. “This will enable the armed forces to complete their emergent and critical acquisitions.”

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