© The Indian Express Pvt Ltd
Tags:
Journalism of Courage
German naval shipbuilder ThyssenKrupp Marine Systems (TKMS) sees significant potential for India to emerge as a naval vessel manufacturing hub due to its substantial cost advantage vis-à-vis Europe and a resurgence in demand for naval defence equipment in the wake of the Russia-Ukraine war and other recent geopolitical conflicts. The company is also pitching the proposition as a strategic collaboration between Germany and India to limit China’s influence in naval equipment supplies, particularly in the Indo-Pacific.
According to TKMS CEO Oliver Burkhard, the German company would want to build submarines and other naval vessels in India for exports jointly with its partner — the state-owned Mazagon Dock Shipbuilders (MDL) — if the combine bags the contract for manufacturing six new diesel-electric submarines from the Indian Navy. TKMS and MDL are competing with the combine of Larsen & Toubro (L&T) and Spain’s Navantia for the P75 (I) (Project 75 India) submarines.
The much-delayed submarine acquisition project is understood to be in an advanced stage with some key decisions likely over the next few months. TKMS’s pitch for developing a joint manufacturing and export hub in India may be seen as part of its effort to win the contract jointly with MDL. The company has communicated its manufacturing hub offer to the relevant authorities in the Indian government.
Burkhard said that TKMS estimates that manufacturing submarines in India would cost less than half of what it costs in Germany — where wages are much higher — which is a big advantage when it comes to catering to more price-sensitive defence equipment buyers in Southeast Asia and even South America. The other reason that TKMS is interested in manufacturing in India is that there is no additional capacity available in its home country and much of Europe as demand for defence equipment jumped in that region following Russia’s invasion of Ukraine.
Not just in Europe, but a number of countries in the other parts of the world are also looking to augment or modernise their defence equipment — including naval assets — which is a significant business as well as strategic opportunity for TKMS and MDL, and also for Germany and India, TKMS India CEO Khalil Rahman said. According to him, China can jump on this opportunity and offer naval equipment to other countries at “friendship prices”, and such sales would be undesirable for India as well as Germany from a geostrategic perspective.
While initially such a collaboration could be limited to building submarines in India, TKMS is keen to expand its footprint in the country and would consider jointly building other naval assets like surface boats and autonomous marine vehicles. On being asked if MDL is the only Indian partner that TKMS is looking to work with to expand its India footprint, Burkhard said that while the Indian PSU would “ideally be the first choice”, the German company is not averse to the idea of partnering with other players in India.
