India’s submarine deal shows what due diligence looks like
India’s submarine deal shows what due diligence looks like
John Queripel

India’s submarine deal shows what due diligence looks like

India’s decision to buy conventionally powered submarines from Germany highlights a sharp contrast with Australia’s AUKUS pathway on cost, capability and planning.

A nation short of submarines, and needing to replace older model by upgrading to something better. Side benefits; technology transfer, and stimulus to local industry by creating thousands of jobs in local shipyards. Sounds like the spiel often used to sell AUKUS, but it isn’t. 

Instead, it is a summary of the announcement made by the Indian Government regarding the deal made with the German company Thyssenkrupp Marine Services for new submarines for the Indian Navy.

There are many similarities between the two deals, but also some major differences. One immediate difference is the cost of the deal – $US10 billion for India, $US240 billion for Australia.

The India deal was inked after an oversight committee looked into the bidding process, and then in the past year completed due diligence concerning costings and technical details. I would guess that planning and due diligence was a tad more extensive than the back of the envelop planning for AUKUS made by Scott Morrison back in 2021. 

In the bidding process, one of the contenders, the Spanish Navantia S80 class was rejected because it was not operationally proven. Now there is a novel idea for due diligence.

The first of the Indian Navy new boats is expected to enter service in 2032, seven years after the signing of the contract. Of course, Australia at that time will still be waiting for –  given current production levels in US shipyards – an unlikely sign off from the then US president, to receive a few (the number is uncertain) Virginia Class submarines.

Forward planning versus forward wishing.

India will be getting six (yes a firm number) of submarines, contracted to be built in India with significant local content: 45 per cent for the first boat and 60 per cent for the last, under a partnership between the Indian Government-owned Mazagon Dockyards Limited and Thyssenkrupp. No, with fingers crossed, sending off down-payments to foreign shipyards. 

The new Indian submarines will operate using an Air Independent Propulsion (AIP) systems, one giving the boats the ability to stay underwater for up to two weeks, while greatly enhancing stealth. Australia in its wisdom after rejecting submarines conventionally propelled (the French Naval Group project), have instead gone down the nuclear path, one on which we have no experience. But here’s hoping.

So, in short, there it is, submarines in the water against submarines in the hypothetical, ‘let’s hope we get them,’ realm. And at half of one per cent of the price!

As they say about buying a car, ‘maybe we should have gone to that yard down the road.’ Still as our Anglo cousins loudly proclaimed, ‘Have we got a deal for you!’ 

‘Psst, leave the Indian alone, I’ve spotted a sucker coming a mile off. Gidday mate’

The views expressed in this article may or may not reflect those of Pearls and Irritations.

John Queripel

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