Adani submits last minute bid for submarine project

Indian Navy

New Delhi: Top industry major Adani Group has made a last-minute entry for the Rs 4,500 crore Indian Navy submarine project by submitting a bid which has taken other contenders by surprise for what is the largest ongoing Make-in-India initiative in the defence sector.

The much-awaited contest was expected to be a faceoff among traditional contenders such as Larsen and Toubro (L&T), Mazagon Dock Shipbuilders Ltd (MDL) and Reliance Naval and Engineering Ltd, all of which own shipyards. The Adani Group does not currently own an active shipyard, which is why the bid has come as a surprise.

Those familiar with the details said the Gujarat-based group could float a special purpose vehicle (SPV) with state-owned Hindustan Shipyard (HSL), which has experience in submarine repairs and overhauls.

The Adani Group is now a contender for all three mega defence acquisition plans under the government’s strategic partnership model – for future fighter jets, naval helicopters and conventional submarines.

Others that submitted bids for the submarine programme are L&T, MDL and Reliance Naval.

The contract, under which an Indian shipyard will be chosen to manufacture six conventional submarines in collaboration with a foreign partner, is in its initial stages. Over the next two months, the defence ministry will scrutinise the bids to shortlist qualified Indian contenders.

The formal tender for the contract — after foreign partners from Russia, France, Germany, Spain and Sweden are selected as part of a parallel process — is expected by the end of the year. At the earliest, the submarine contract can be awarded to the winning contender after two years.

The single biggest shipbuilding plan under the strategic partnership model is expected to see state owned MDL as the frontrunner, given its experience in building the Shishumar class of submarines as well as the current production line for the Kalvari (Scorpene) class of boats.

The Adani Group has ambitious plans in defence, with its acquisition late last year of Bengaluru-based Alpha Design Technologies Pvt Ltd that has a strong order book and tieups with big Russian and Israeli companies.

The acquisition has enabled Adani to get involved in the specialised defence and space business. Its product list now ranges from drones to helicopters and simulators. It’s also one of the major suppliers for the indigenous Light Combat Aircraft (LCA) programme.

The acquisition placed Adani Defence and Aerospace in the big league that includes the Tata Group, Mahindra & Mahindra, Reliance Defence and L&T, which are vying for large Make-in-India projects under the strategic partnership scheme. Adani unveiled a manufacturing facility in Hyderabad last year to make Hermes 900 drones in collaboration with Israel’s Elbit Systems.

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