Defence Ministry Shortlists Two Domestic Firms for Submarine Project, Adani Out

Defence Industry

New Delhi: In a blow to Adani Group it was not even considered for the mega submarine project of the Indian Navy valued at over Rs 60,000 crore with the Defence Ministry on January 20 shortlisting two domestic firms for the multi-billion-dollar contract to build six conventional submarines which are Larsen & Toubro and state-run Mazagon Dock Shipbuilders.

The ministry also approved five foreign companies for the mega contract, which is part of a 30-year plan to construct 18 conventional and six nuclear-powered submarines.

According to the Project 75 India, or P75(I), the foreign company will enter into a partnership with an Indian firm under the Strategic Partnership model and jointly build the vessels in India.

“Defence Acquisition Council (DAC) headed by Defence Minister Rajnath Singh, in its first meeting of 2020 and after the constitution of Chief of the Defence Staff, approved shortlisting of Indian Strategic Partners (SP) and the potential Original Equipment Manufacturers (OEMs) that would collaborate with SPs to construct six conventional submarines in India,” a statement released by the defence ministry said.

noval

The Adani Group, which had made a bid to be part of the race, was not considered, sources said.

After the Navy invited expressions of interest (EOI) in 2019 to build six conventional submarines under the strategic partnership model, four Indian firms had responded. They were L&T, Mazagon Dock Shipbuilders, Reliance Naval & Engineering, and Hindustan Shipyard (HSL) with Adani Group.

Based on a study and analysis of financial strength and facilities of various shipyards in the country, an empowered committee of the Navy had shortlisted Mazagon Dock and private sector giant L&T as possible partners.

The Navy reportedly rejected Adani’s bid with HSL on the ground that it was not in accordance with the approved process. While Adani had the financial strength, it did not have a shipyard of its own and hence bid with HSL.

However, the Department of Defence Production, under which HSL functions, reportedly wanted the Navy to consider the joint bid afresh.

Meanwhile, sources said the five foreign firms selected are Naval Group of France, Rubin Design Bureau of Russia, Navantia of Spain, Daewoo Shipbuilding and Marine Engineering of South Korea and German firm ThyssenKrupp Marine Systems.

Swedish firm SAAB had earlier withdrawn from the project saying there has to be a rethinking on the policy.

Russia is pushing for a government-to-government deal for the submarines while pitching for a joint design.

Leave a Reply