Germany Likely To Opt Out Of Navy’s Submarine Project, South Korean Company May Be Only Vendor

17 August 2021

The Navy’s plan to build six conventional submarines in India for an estimated Rs 43,000 crore is heading for troubled waters, with one of the prime foreign technology partners saying that it may not proceed with the negotiations as it finds some of the tender requirements too restrictive.

If the German group does not change its stand, the mega project could be heading for a single foreign vendor situation with South Korea’s Daewoo Shipbuilding and Marine Engineering as the only contender.

Germany’s ThyssenKrupp Marine Systems (TKMS), which was considered as the frontrunner for the mega project, has raised concerns that some conditions are impossible to be fulfilled, including a high indigenous content percentage and almost unlimited liability on the foreign technology partner.

The Navy has been informed that the German company will not proceed in further engagement on the issue with Indian partners unless major changes are made in the tender conditions, a difficult scenario given the strict defence procurement rules.

As first reported by ET, the German company had emerged as the frontrunner after a condition was put in the tender for a sea-proven Air Independent Propulsion (AIP) system –– a critical component that will enable these boats to remain submerged for over two weeks, as against the 2-3 days of underwater endurance of the current submarines.

This requirement for a sea-proven AIP had effectively removed three of the five shortlisted foreign vendors, leaving only Germany and South Korea in the fray. The other three –– Russia, France and Spain –– do have AIP technology but it is not fitted on a submarine where it can be demonstrated. AIP technology has been demonstrated by DRDO as well but is yet to be sea-proven, with estimates that it could take 4-5 years at the earliest.

The boats are to be built either by Mazagaon Dockyard Limited (MDL) or Larsen and Toubro (L&T), with the winner being decided on the basis of techno-commercial proposals drawn up in consultation with the foreign partner.

Courtesy: ET News