Indian Navy's submarines to be made locally; Rs 60,000-cr P75 I will be last order from abroad

NEW DELHI: The shipbuilding industry is set for mega business with the government deciding that an ongoing Rs 60,000 crore plan to procure diesel electric submarines will be the last order to go to foreign firms and that all future projects will be designed and made in India.

Leading international players, which have for long eyed India as one of the largest importer of submarines in the world, are currently in contention for the P75 I project to manufacture six new stealthy submarines in India.

A top Navy officer told ET that the government has cleared the project on the condition that all future acquisitions of conventional submarines will be based on an indigenous design and produced at Indian shipyards. The Navy has accordingly initiated a futuristic design plan even though the next batch of conventional submarines under Project 76 would take several more years before a firm order is placed..

“It has been decided that after P75 I, all future submarines will be of our own design and will be made in India. The government has been very clear on this and we have already begun the work, even though the requirement is of the future,” Navy's Controller of Warship Production and Acquisition Vice Admiral AV Subhedar confirmed to ET.

A similar project for six new nuclear powered submarines will obviously be of Indian design as foreign collaborators cannot share such technology openly. Private firm L&T is already working the Navy on this project

Sources said that the decision was conveyed at the very top with the government keen that the Project 76 be completely indigenous with the participation of both public and private shipyards. Indian firms like Pipavav, L&T and ABG shipyards are set to be the biggest gainers from this decision as public sector shipyards do not have the capacity to match up the demand. Navy officials said that the next requirement under Project 76 would come up towards the end of this decade.

A recent study by EY shows that the requirement for warships and submarines in India far outstrips the capacity of public sector shipyards. It has estimated that orders worth Rs 8,47,000 crore will be placed by India in the next 15 years. Private yards, the EY study says, will be in contention for an annual business of RS 25000 crore for the next 15 years due to a lack of capacity from the public sector to deliver. EnY also suggests that in case the government can implement the Make in India plan for the defence forces, a saving of at least 20 percent or Rs 3 lakh crore in terms of capital expenditure can be achieved over the next 12 years in terms of military purchases.

At present, the Indian Navy has 13 conventional and one nuclear attack submarine as part of its underwater fleet. The conventional fleet relies primarily on the Russian Kilo class with nine of these submarines – most older than 20 years – in service. In addition, four German origin HDW subs are available with the Navy that are currently being upgraded to fire the Harpoon anti-ship missiles.

At present, 6 new French origin Scorpene submarines are under construction in Mumbai with the first one set to enter service next year. In addition, India is getting ready to deploy its Arihant class nuclear missile boat towards the end of this year. The Navy is also likely to lease a new nuclear attack submarine from Russia shortly.