Setback for Indian Navy: Rs 32,000 crore project to build 12 minesweepers scrapped, says report

 BusinessToday.in        Last Updated: January 8, 2018  | 14:56 IST
Setback for Indian Navy: Rs 32,000 crore project to build 12 minesweepers scrapped, says report

A Rs 32,000-crore project to indigenously build 12 minesweepers at the Goa Shipyard Ltd (GSL) in collaboration with South Korean firm Kangnam Corporation has reportedly just fallen through, dealing a major blow to the government's Make in India mission.

According to sources cited by The Times of India, this decision was taken by Union Minister for Defence Nirmala Sitharaman. "Goa Shipyard has been asked to issue a new global expression of interest for the mine counter-measure vessels (MCMVs). The fresh RFP (request for proposal) or tender will follow thereafter," quoted the daily. With this, the Indian Navy's nearly decade-old quest for new minesweepers, desperately needed to beef up security along its long coastline, has been pushed back even further.

The world's fifth largest navy reportedly has only four minesweepers in active service-all acquired from the erstwhile Soviet Union between 1978 and 1988-to defend its 14 ports. The Navy needs six-times that number to plug the shortfall.

Worse yet, the defence ministry last year revealed to a parliamentary panel that all the MCMVs currently operational will be retired by 2018-2020. So the government does not have the luxury of time to float the fresh tender for minesweepers, whose role is to clear sea mines laid by enemy warships, submarines and aircrafts to blockade harbours and offshore installations or to disrupt maritime trade.

Incidentally, this is not the first time that the collaboration between GSL and Kangnam Corp has fallen through. In 2008, the UPA Government had floated a tender for minesweepers that the Busan-based firm had won. Then tom-tomed as India's first major defence hardware import from East Asia, the Rs 2,300 crore deal involved importing two MCMVs and the required technology transfer to indigenously build another six vessels. But the defence ministry had scrapped this deal in 2014 after an inquiry revealed that the South Korean shipyard may have hired middlemen to facilitate the contract.

The following year GSL bagged the larger Rs 32,000-crore order, again in collaboration with Kangnam Corp. Under the new deal, 12 vessels were to be constructed in India, with 60% indigenous content, and deliveries were to be completed between 2021 and 2026.

But perhaps the deal was doomed from the start. The already slow-to-take off project then faced a lot of issues ranging from a difference in opinion over the selection of propulsion engines for the vessels to be built to the quantum of technology expertise to be transferred. In the meantime, GSL has already invested over Rs 700 crore in building infrastructure for construction of the MCMVs.

The ministry of defence will reportedly issue a fresh global expression of interest to Kangnam, Italy's Intermarine Shipyard-which was the second closest bidder in the 2008 tender-and other foreign shipyards that specialize in building MCMVs, with non-magnetic hulls and high-definition sonars, acoustic and magnetic sweeps to detect marooned and drifting mines.

In the face of China flexing its muscles in the Indian Ocean-one of the most militarised regions of the world with at least 100 warships prowling at any given time-one hopes the Indian Navy gets its minesweepers sooner rather than later.

With PTI inputs

 

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