1. Narendra Modi government shortlists Larsen & Toubro, Pipavav for Rs 60,000 crore submarine contract

Narendra Modi government shortlists Larsen & Toubro, Pipavav for Rs 60,000 crore submarine contract

Government has shortlisted L&T and Pipavav Defence, in which Anil Ambani group firm Reliance Infra has recently acquired management control...

By: | New Delhi | Updated: March 12, 2015 5:31 PM
India submarine, Indian Navy

Project 75i is designed to purchase 6 next generation diesel submarines with Air Independent Propulsion System (AIP) technology for Indian Navy by 2022. (Reuters)

The Narendra Modi government has shortlisted Larsen & Toubro (L&T) and Pipavav Defence & Offshore Engineering Company, in which the Anil Ambani group firm Reliance Infrastructure has recently acquired management control, for award of a Rs 60,000-crore contract to build six conventional submarines under its Project 75i.

According to highly-placed sources, a high-level committee headed by vice-admiral Subhedar, which had inspected both public and private shipyards to shortlist candidates to issue the request for qualification (RFQ) for Project 75i, in its final presentation to the ministry of defence (MoD) last week, selected the two private sector shipyards — L&T’s Katupalli yard and Pipavav unit.

The tender, the sources said, would be a ‘buy and make (India)’ one, which implies tie-ups for technology with foreign collaborators with substantial manufacturing in India.

Pipavav Shipyard has entered into some agreements recently with some global majors with a view to diversify into the submarine market and also has the capacity to build many boats simultaneously.

At a Defence Acquisition Council meeting last year, the MoD was directed to set up a committee to identify shipyards in India capable of building submarines.

The committee, with representatives from the Navy and MoD, conducted a survey of shipyards along both the coasts, including Garden Reach Ship-Builders, Hindustan Shipyard, Goa Shipyard, L&T, Mazgaon Docks, ABG Shipyard and Pipavav Shipyard.

According to the government’s decision all six submarines will be built in India on the lines of the predecessor P75 Scorpene production line at MDL, Mumbai. Bids were invited from Indian shipyards to build the six submarines using transferred technology from a foreign partner.

Project 75i is designed to purchase 6 next generation diesel submarines with Air Independent Propulsion System (AIP) technology for Indian Navy by 2022. While conventional diesel-electric submarines have to surface every few days to get oxygen to recharge their batteries, AIP systems will help the submarines to stay submerged for longer periods. Apart from AIP, the new submarines will have advanced detection range and combat management systems and better sensors for optimum performance. The weapon system would be a mix of torpedoes and missiles.

Among the potential foreign submarine contenders in the race for Project 75i are French DCNS ‘Scorpene’, Russia’s Rubin Amur 1650, the German HDW Type 214, Spain’s Navantia S-80 which broke its partnership with DCNS a while ago has been offering the S-80 design with an ethanol based AIP supplied by Abengoa.

Navantia also has a tie-up with Lockheed Martin for combat management systems and on India, it is known to have been working closely with L&T albeit on surface ship projects. The Swedish Kockums Archer-class is also in the race. Interestingly, DCNS of France, already has a technology tie-up with Pipavav Defence. Sembcorp Marine (Singapore), part of Temasek of the Singapore government and a leading global marine engineering group, has a strategic and equity partnership with Pipavav Defence.

For Reliance Infrastructure, which will spend Rs 819 crore for an 18% stake in Pipavav Defence and is slated to acquire an additional stake from the latter’s promoters to increase the shareholding to above 25%, winning Project 75i will be crucial step in getting into defence manufacturing, an integral part of Narendra Modi government’s Make in India campaign.

As per sources, in addition to the leased Russian nuclear-propelled submarine (INS Chakra) and the indigenously built Arihant, India’s navy currently has 13 aging diesel-electric submarines, only half of which are operational at any given time due to refits. Last year, a submarine sank after explosions and a fire while docked in Mumbai.

The delays in the `Scorpene’ (project 75) at Mazgaon Dock Limited (Mumbai) which was intended to induct the vessels at the rate on one ship per year since 2012 has left the Submarine force well below requisite levels. further, previously planned induction of 05 midget submarines and also the fresh impetus on the strategic submarine program constitute a work-load that is far beyond the capacity of existing public sector shipyards.

The six new submarines in P-75 I project will outline various critical parameters including the weight and design of the submarine. The Project 75I submarines are expected to be bigger than the 1800-ton Scorpene class being built for P-75 project. The AIP systems will enable greater underwater endurance and land-attack missiles. Besides, they will also incorporate stealth, land-attack capability and other technological advancements.

Though the government is keen on indigenisation as much as possible, there is still a need for foreign cooperation in this project. Hence, there are four major players in the race.

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