Spain’s Navantia and L&T sign pact to bid for Indian submarine programme

Spain’s state-owned shipbuilder Navantia and engineering major Larsen & Toubro signed an agreement on Monday to jointly bid for a ₹43,000-crore project to build six advanced submarines for the Indian Navy.

The agreement will put the firms in competition with Germany’s ThyssenKrupp Marine Systems (TKMS) and India’s state-owned Mazagon Dock Shipbuilders Limited (MDL), which signed a similar pact on June 7 to bid for the same project under the Indian government’s strategic partnership (SP) model.

The teaming agreement for submission of a techno-commercial bid for the P75-India submarine programme was signed by officials of the two firms in the presence of Spanish ambassador José Domínguez, L&T CEO SN Subrahmanyan and Augustin Alvarez Blanco, Navantia’s vice president for naval construction.

Project 75I requires an Indian bidder to tie up with a foreign collaborator and build six conventional submarines equipped with air-independent propulsion (AIP) systems, which allow vessels to remain submerged for longer periods. The first submarine must have a minimum of 45% indigenisation, with the indigenous content going up to 60% in the sixth.

Asked about the race with Germany’s TKMS, Subrahmanyan said: “At the end of the day, it’s competition. I wish we get sweetheart deals but that doesn’t happen. So, we’ll have to bid good. One cannot predict what will be the end result, but we are two competitors, let’s say it’s 50-50 at the moment.”

Subrahmanyan contended the AIP system offered by Navantia is “much better”, and the “transfer of technology in our agreement would be of far higher content and value addition from the Indian defence point of view”. He added, “I would rate it fairly high-end, but let’s go through the competitive processes.”

Officials from L&T and Navantia said the AIP being offered is a third-generation system that runs on bio-ethanol and has lower operating and through-life costs. Navantia will base the design on its S80 class of submarines, which have abundant space for indigenisation of equipment in line with Indian requirements, and the weapons complexes will be Indian, they said.

The first S80 submarine was launched in 2021 and is undergoing sea trials before its delivery to the Spanish Navy by the end of 2023.

L&T has played a crucial role in several defence projects, including the construction of India’s first indigenous nuclear-powered submarine. Subrahmanyan said, “This is a very important programme from the Indian point of view because many strategic underwater assets are getting to be life-stretched and it’s important to have a replacement.”

He added L&T and Navantia are hopeful of being fully prepared to put in a bid by the due date in August.

While the design offered by TKMS has an existing AIP system, Navantia’s system will soon be fitted in an S80 submarine, said Blanco. “This is for us only the first step in our partnership with L&T because we are also teaming with them for the offer for the LPDs (landing platform docks),” he said, referring to India’s plans to acquire the amphibious warfare vessels.

Domínguez said Spain fully supports the “Make in India” initiative, as reflected in the Spanish government’s engagement in transferring technology to a partner and ally such as India.

“We consider that Spain is a reliable partner for India…in the sense that we have developed a technology which is very convenient for India, and we don’t influence the balance of power in this part of the world,” the envoy said.

“We don’t influence the…strategic autonomy of India, we respect it completely because the interest of Spain in this part of the world is to contribute to stability,” he added.

The P-75I programme is one of the biggest under the Make in India initiative.

Four HDW class 209 submarines built in the 1980s have proved a successful model for Indo-German cooperation, TKMS said after it signed the agreement with MDL. The first and second of those submarines were built in Germany and the remaining two at MDL in Mumbai. TKMS has now offered the advanced HDW Class 214 submarines.

India cleared the project two years ago to strengthen the navy’s capabilities and give momentum to a defence indigenisation drive. The SP model envisages the indigenous manufacture of defence platforms by an Indian firm collaborating with a foreign original equipment manufacturer to set up facilities in the country.

In January 2020, the defence ministry cleared two Indian and five foreign shipbuilders, including TKMS, to take part in P-75I. The Indian strategic partners were MDL and L&T. The foreign yards included France’s Naval Group, Russia’s Rubin Design Bureau, Navantia and South Korea’s Daewoo Shipbuilding & Marine Engineering Company. Naval Group and Rubin Design Bureau withdrew from the competition a year ago.

P-75I, first talked about more than two decades ago, has moved at a notoriously slow pace. It was a part of the 30-year submarine-building programme approved by the Cabinet Committee on Security in 1999.

MDL-TKMS and L&T-Navantia seem to be the main contenders for the project unless a dark horse emerges, said maritime affairs expert Commodore Srikant Kesnur (retd).

“Considering the shortfall in conventional submarines, P-75I will fill a critical capability void. The impetus given to making in India is an important consideration. Hopefully, the final outcome would be that after this, India won’t need any foreign partners and will be able to design and build submarines completely indigenously,” he said.

However, the project’s execution may take almost a decade and the new submarines will come in only in the 2030s, Kesnur said. “As an interim solution, we may need submarines from elsewhere to balance the depletion in force levels. Possibly, a repeat order for three Scorpene submarines could help,” he added.