SOURCE: AFI
In a significant move to bolster its underwater capabilities, the Indian Navy has finalized a deal exceeding Rs 36,000 crore with Mazagon Dockyards Limited (MDL) for the construction of three additional Scorpene-class submarines. The contract, which is poised to be signed by March 31, 2025, marks a new chapter in India’s naval strategy but raises questions due to the steep increase in costs compared to previous acquisitions.
Each of the new submarines is set to cost around Rs 12,000 crore, a figure that has sparked considerable debate. This is nearly three times the cost of the six Scorpene submarines acquired under the initial Project-75, where each submarine was priced at approximately Rs 3,500 crore, totaling Rs 21,000 crore for all six. The significant price hike has not been thoroughly explained by officials, leaving room for speculation and concern over budgetary implications.
A key point of discussion is the exclusion of the Air Independent Propulsion (AIP) system from the base price of these new submarines. Developed by the Defence Research and Development Organisation (DRDO), the AIP system is expected to add to the overall cost, making the deal even more expensive. Although the submarines are touted to have a higher percentage of local content compared to their predecessors, the rationale behind the price increase remains murky. This increase in local content was expected to potentially reduce costs by minimizing reliance on foreign components, but the opposite appears to be true.
Media outlets and defense analysts have expressed concerns over the cost, questioning the transparency and efficiency of the procurement process. There’s a call for a clearer breakdown of why the prices have escalated so dramatically, especially since one would expect economies of scale and technological learning to bring costs down.
NOTE: AFI is a proud outsourced content creator partner of IDRW.ORG. All content created by AFI is the sole property of AFI and is protected by copyright. AFI takes copyright infringement seriously and will pursue all legal options available to protect its content.