Explained: Why Indian Navy’s P-75I submarine project failing to get partners?

India's plan to indigenously build a diesel-electric class submarine under Project-75I hangs in the balance

In a minor setback on Tuesday it was reported that Naval Group, a major French submarine maker, has pulled out of India's Project 75 (I) ahead of Prime Minister Narendra Modi's visit to France.

The Naval Group has mentioned the conditions in the request for proposal (RFP) as the reason for exiting the project. The Ministry of Defence had in July last year issued an order to build six submarines for the Indian Navy.

The cost of this project named Project 75 (India) is Rs 43,000 crore.

The RFP was sent to five big companies, including France's Naval Group-DCNS, Russia's Rosoboronexport, Germany's Thyssenkrupp, Spain's Navantia and South Korea's Daewoo, around the world for the Project 75 (I).

The two Indian companies (called strategic partners) have to tie up with one of the five shortlisted foreign companies -- ThyssenKrupp Marine Systems (Germany), Navantia (Spain) and Naval Group (France), Daewoo (South Korea), and Rosoboronexport (Russia) -- and then respond to the RFP, according to the Defence Ministry.

The Rs 43,000 crore contract will be awarded by the Defence Ministry following a detailed evaluation of the responses sent by the two strategic partners.

All about the P-75 India project

The Project 75 (India)-class submarines, or P-75I, for short, are a planned class of diesel-electric submarines, which are to be built for the Indian Navy. The P-75I class is a follow-on of the P-75 class submarines of the Indian Navy.

Under this project, the Indian Navy intends to acquire six conventional, diesel-electric attack submarines, which will also feature advanced capabilities - including air-independent propulsion (AIP), ISR, special operations forces (SOF), anti-ship warfare (AShW), anti-submarine warfare (ASW), anti-surface warfare (ASuW), land-attack capabilities and other features.

All six submarines are expected to be constructed in India, under the Make in India initiative.

Multiple delays

The P-75I project has been in limbo for a while after several unwarranted delays and pushbacks. According to a top official of India's largest submarine builder, the government had to push back the bid submission from November 2021 to June 2022 after the majority of overseas participating companies found it impossible to reach the original deadline. And if the bid submission takes place in June, it will take another two years for the government to consider it before orders are placed by the end of 2024.

Why are Foreign contenders withdrawing?

Just a month after the RFP was issued, ThyssenKrupp Marine Systems (TKMS) of Germany, the frontrunner for the mammoth project, had expressed concern that some stipulations, such as a high indigenous content proportion and nearly unlimited liability on the foreign technology partner, maybe impossible to meet.

Earlier, even the Swedish company pulled out, with insiders claiming that its engineers and management deemed the terms difficult to meet.

French company Naval Group said it is unable to participate due to conditions mentioned in the request for proposal (RFP) related to air-independent propulsion (AIP) system.

The withdrawal of the French Naval Group could be discouraging as it was this same company that transferred technology to India for manufacturing the Scorpene-class submarines at the Mazgaon Dockyard Limited.