India’s Finance Ministry, which holds the levers for all capital spending by the government, is believed to have given its clearance for a Rs 70,000 crore budget to build the Indian Navy’s six advanced next-generation submarines.
The proposal will now go to Prime Minister Narendra Modi-led Cabinet Committee on Security (CCS) for final approval before the Indian Navy signs a deal with the state-run Mazagon Dock Shipbuilders Limited (MDL).
German firm ThyssenKrupp Marine Systems would provide the technology and technical support to build the submarines at the MDL. The MDL-TKMS had outbid a proposal from the private sector shipyard owned by Larsen & Toubro that joined Spanish Navantia for the tender.
The Indian Navy aimed to sign the contract last fiscal year by March 2026. However, the contract negotiations between the Ministry of Defence (MoD) and the MDL-TKMS combine took a couple of months before the proposal could be put up before the Finance Ministry.
The contract signing is expected in June 2026 after the CCS gives its stamp of approval for the deal. Post the contract signing, MDL would get seven years to deliver the first of the six submarines.
These next-generation submarines would come with the advanced Air Independent Propulsion (AIP) system, enabling the conventionally powered vessels to stay submerged in water for a longer duration.
While the first submarine is expected to be delivered by 2033, the remaining five submarines under what is codenamed as Project 75(I) would be delivered at the rate of one vessel a year, completing the project by 2038, the officers said.
The much-delayed Project 75(I) is part of the Indian Navy’s 25-year-old Submarine Building Plan under which 24 conventional diesel-electric powered vessels were to be built by 2030.
Project 75(I) submarines become critical to the Indian Navy as its submarine fleet had dwindled to just 14 submarines. India’s strategic forces also operate a nuclear-powered and three nuclear-armed submarines.