India, Germany close to signing $8 bn P75I submarine deal, pact likely by March-end

New Delhi: India and Germany are on the verge of signing a $8 billion Project-75(I) submarine manufacturing agreement, which is set to become India’s largest-ever defence deal. The agreement, likely to be signed by March-end as negotiations have reached an advanced stage, will be a historic milestone in Indo-German defence cooperation.

The long-pending Project-75 India (P-75I) is meant to address the problem of India’s ageing conventional submarine fleet as well as enhance Indian Navy’s underwater capabilities and strengthen maritime deterrence in the Indo-Pacific region at a time both China and Pakistan are increasing their presence in the Indian Ocean Region.




The P-75I submarine programme could cost India upwards of Rs 70,000 crore-Rs 72,000 crore ($8 billion), which is set to become bigger than the Rs 58,000-crore deal for 36 Rafale jets signed with France in Sept 2016.

It involves construction of six advanced, conventional diesel-electric attack submarines. The selected Type-214 Next-Generation submarines are chosen for their proven, fuel-cell-based air-independent propulsion (AIP) technology, which enables them to remain submerged for weeks, rather than just a few days, sharply reducing detection risks.

Also read: Project-75I: How India’s $8 billion submarine upgrade reshapes the Pakistan, China equation

In partnership with Germany's ThyssenKrupp Marine Systems (TKMS), Mazagon Dock Shipbuilders Ltd (MDL) will build these submarines domestically under a strategic partnership model, aiming for 45-60% indigenisation to bolster the ‘Make-in-India’ initiative. The proposed agreement, which reportedly received the much-needed push during the India visit of German Chancellor Friedrich Merz on Jan 12 and 13, may include technology transfer for submarine production.

The Indian Navy currently operates about a dozen Russian submarines and six new French-made models.

In Oct 2014, the procurement of six submarines under Project 75I was approved by the defence acquisition council. Thereafter, the defence ministry issued the formal request for proposal (RFP) for the construction of six AIP-fitted conventional submarines under P-75I on July 20, 2021.

The submarine project will not only aid in boosting the core submarine and ship building industry but will also greatly enhance the manufacturing and industrial sector, especially MSMEs by development of an industrial ecosystem for manufacture of associated spares, systems and equipment related to submarines.

The govt has of late stepped up efforts to implement Indian naval indigenisation plan 2015–2030. Under it, 51 large ships are already under construction in the country, valued at approximately Rs 90,000 crore. Since 2014, Indian shipyards have delivered over 40 indigenous warships and submarines to the Navy, with a new vessel being inducted on average every 40 days in the last one year.