The Defense Acquisition Council (DAC) under the Indian Ministry of Defense has disqualified the joint bid by L&T (Larsen & Toubro) and Navantia (a Spanish firm) on technical grounds. This decision leaves the other joint bid, by MDL (Mazagon Dock Shipbuilders Ltd) and TKMS (Thyssenkrupp Marine Systems, Germany), as the sole contender for the Indian Navy’s Project P75(I) Submarine program.

Why DAC Rejected the Bid?

The bid was rejected on technical grounds for failing to meet the Indian Navy’s requirement for a proven air-independent propulsion (AIP) system.

What is AIP?

An Air-Independent Propulsion (AIP) system is an advanced technology used in submarines to enhance their stealth and operational capabilities. It allows non-nuclear submarines to operate without surfacing or using a snorkel to access atmospheric oxygen, which is typically required for running diesel engines.

The P75(I) program, the first to be executed under the Ministry of Defense’s Strategic Partnership (SP) model, requires the incorporation of an AIP system. This technology greatly improves a submarine’s underwater endurance, enabling it to stay submerged for prolonged durations without relying on atmospheric oxygen.

The Defence Acquisition Council (DAC) is anticipated to finalize the selection of the vendor for this crucial program soon. Project 75I aims to upgrade India’s submarine fleet with state-of-the-art features, including the incorporation of Air Independent Propulsion (AIP) technology to boost stealth and extend operational endurance.

“MDL confirms that the Ministry of Defense has opened the commercial bid submitted by MDL for further processing,”

Mazagaon Dockyards Limited

The Mazagaon Dockyards recently handed over the final submarine, INS Vagsheer, of the six constructed under Project 75 Scorpene class for the Indian Navy. Furthermore, they are poised to secure orders for three additional submarines under Project 75 (Additional Submarine), which will be built in collaboration with the French Naval Group.

The selection process has been under thorough scrutiny, with sources suggesting that a technical oversight committee reviewed all bids and determined the MDL-TKMS proposal to be compliant with the required specifications. In contrast, the L&T-Navantia bid was reportedly disqualified, primarily due to issues concerning the Air Independent Propulsion system.

As per reports, L&T’s share are falling after this rejection by DAC, while MDL Shares have gone up by 5%.

Estimated at Rs 70,000 crore—significantly higher than the initial budget benchmark of Rs 43,000 crore set under the Defence Ministry’s Acceptance of Necessity (AON)—the P75I project will necessitate TKMS designing a submarine customized to meet the Indian Navy’s requirements.

The first submarine under the Project P75(I) program is anticipated to be delivered within seven years of the contract signing. If the deal is finalized shortly, deliveries could commence as early as 2032. Sources also disclosed that the Indian Navy submitted its Field Evaluation Trial (FET) report to the Ministry of Defense late last year, confirming that the TKMS submarine fulfilled all technical specifications.

What is Indian Navy’s P75(I) program?

The P75(I) program is a strategic initiative by the Indian Navy aimed at enhancing its underwater warfare capabilities by inducting advanced conventional submarines. This project is part of India’s broader efforts to modernize its naval fleet and strengthen its maritime defense infrastructure.

Key Features of the P75(I) program:

1. Indigenous Construction: P75(I) is the first submarine-building project to be implemented under the Strategic Partnership (SP) model, encouraging collaboration between Indian shipyards and foreign Original Equipment Manufacturers (OEMs).
2. Advanced Capabilities:
   • Integration of Air Independent Propulsion (AIP) systems to significantly enhance underwater endurance and stealth capabilities.
   • Modern weapons systems and sensors, including advanced torpedoes, guided missiles, and sonar systems.
   • Capability to launch Land Attack Cruise Missiles (LACMs) for long-range strikes.
3. Number of Submarines: The project involves the construction of 6next-generation conventional diesel-electric submarines.
4. Focus on Self-Reliance:
   • Aligns with the Indian government’s Atmanirbhar Bharat (Self-Reliant India) initiative by encouraging domestic defense manufacturing.
   • Aims to develop a robust ecosystem for submarine production in India.

Strategic Importance:

• Fleet Modernization: Replaces aging submarines in the Indian Navy’s fleet to maintain operational readiness and superiority.
• Enhanced Maritime Security: Strengthens India’s ability to safeguard its vast coastline, exclusive economic zone (EEZ), and strategic interests in the Indian Ocean Region (IOR).
• Deterrence: Acts as a strong deterrent against adversaries by bolstering India’s underwater combat capabilities.