The Hindu : National : German firm keen on submarine bid; pressure to consider various offers

Online edition of India's National Newspaper
Friday, Jul 08, 2005

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National

German firm keen on submarine bid; pressure to consider various offers

Sandeep Dikshit

NEW DELHI: The Navy's quest to acquire submarines has taken a new turn with diplomatic pressure being mounted on the Government to consider offers from other countries. At present, the French company, Scorpene, is the only contender with the Navy contending that it had considered and rejected the German company HDW's submarines in 2002.

However, German Chancellor Gerhard Schroder and his Economic Minister recently spoke to senior Central Ministers asking HDW to be given a chance after it was cleared of bribery allegations by the Delhi High Court, said reliable sources here.

A HDW delegation has also arrived in the country but despite being cleared by the court it has still not been invited by the Navy for discussions. All that the team has managed is an audience with a senior Navy official where it gave a presentation on the recent corporate restructuring.

With the Navy opposed to reconsidering offers from the German and Russian companies on grounds that the process would last for three years and further delay plans to replace its ageing submarines, the German company is prepared to consider offering a couple of second hand submarines to fill the gap till the new ones roll off the docks.

Sources also dispute the Navy's contention that it had evaluated the German submarines. "No technical, commercial or contractual data was on the table in India nor did any Indian delegation visit Germany. May be it was a cursory examination on the basis of the brochures because at that time the Government had placed curbs on the Defence Ministry in dealing with the company," he explained.

"Every time official talks are held, the Indians sound positive (on considering the HDW offer) but during talks with Defence Ministry officials, the optimism disappears.

Cheaper offer

The German side is believed to have offered India to build the submarines at a cheaper cost than the French and also perform 30 per cent off-set, meaning one-third of the cost would be compensated in other ways. On the table are technology transfer that could help India build more submarines on its own in the future, on-the-job training and involvement of Indian companies in building submarine construction facilities and providing spares.

India has 16 submarines of which two are at the end of their careers. It has 10 Russian submarines some of which are due to be phased out and four relatively new German submarines built by HDW. As the first submarine will become operational at least five years after the contract is signed, the Navy is keen that the decision is taken at the earliest so that it does not have to carry on with ageing vessels.

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