SOURCE: IDRW.ORG
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The ambitious Project 75I (P-75I) of the Indian Navy, aimed at procuring six advanced diesel-electric submarines, has seen a dramatic escalation in costs. Initially projected in 2022 to be around ?40,000 crore ($4.89 billion), recent reports now estimate the total expenditure for the project to have soared to an astonishing ?70,000 crore ($8.55 billion).
This significant increase in the budget for the P-75I program, which seeks to enhance India’s underwater capabilities with submarines featuring air-independent propulsion (AIP) systems, has raised eyebrows and sparked debates on the fiscal management of defense projects. The project, which has been long in the making, is crucial for the Indian Navy to replenish its aging submarine fleet and to counterbalance regional naval challenges.
The submarines are expected to incorporate state-of-the-art technology, including AIP systems, which allow for longer underwater endurance. The integration of such advanced systems has evidently driven up costs. Over the years, inflation and the depreciation of the Indian Rupee against the dollar have naturally increased the financial burden of the project.
Delays in project execution often lead to cost overruns due to extended labor costs, maintenance of infrastructure, and the need for updated technology to meet the latest standards. The cost of raw materials and specialized components for defense manufacturing has been rising on the global market, affecting the overall project cost.
A key aspect of Project 75I is the transfer of technology for local manufacturing, which involves setting up new facilities, training, and ensuring compliance with international standards, all adding to the financial outlay.
The Indian Ministry of Defence has yet to officially comment on this cost escalation, but such increases are not uncommon in defense procurement, where the initial estimates often do not account for all eventualities. This situation highlights the challenges of executing large-scale defense projects in a volatile economic and geopolitical environment.
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