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December 2009 I Commentary on Naval Construction Projects

A look at the Naval Augmenting Capability
construction projects –
current and planned With India's increasing global clout, the Indian Navy is poised for a much larger role.

The Indian Navy is augmenting capability to emerge as a truly blue-water Navy with
strategic reach to operate from Africa's eastern coast right up to the Malacca Straits. It
is working towards becoming a networked-force with capabilities to manage and
control the entire Indian Ocean Region (IOR).

While some acquisitions of the Indian Navy have been beset with delays and
protracted procurement procedures, the strategic blueprint and planned expansion of
capability gives reassurance of efforts to meet the desired objectives

This commentary provides a quick round-up of some of the major programmes

Strategic Advisory Services

Project 15B and the vessel’s under this Original Price: USD 974 Million programe will have stealth capabilities and the Final agreed price : USD 2. Guided Missile Destroyer In 2009. Project 17A After intense negotiations and a cost over-run Stealth Frigates of 200%. This is termed as 2009.127 Million for each frigate. The final price will only be Project 15A & 15B known once the RFP is responded to. DOCKS (MDL). This method is INS KOLKATA to be delivered in MAY also being used in the manufacture of the 2010. INS VIKRAMADITYA’s ETA can cost of each being approx. USD 578 no longer be delayed. Project 1143 Price: Each vessel estimated to cost approx. Delivery. with less than 10 still being with the cost of the Shivalik class operational. The subsequent vessels will join after a gap of Currently undergoing refit and 1 year each. modular construction method. Budget.a. the final price has been agreed at Planned to be built at MAZAGAON USD 2. experience in this form of construction. Since the 2 2011 and the third (un-named) vessel shortlisted shipyards did not have any prior in MAY 2012.Construction is slated to begin by end 2011 and the first The worry now for the country is that INS delivery is anticipated in 2015-2016. Aircraft Carrier ADMIRAL GORSHKOV a. the DAC ascertained that the total project cost will be USD 9. Million. DOCKS (MDL) and GARDEN REACH In addition a deal worth USD 740 million was Shipbuilders and Engineers (GRSE) signed for 16 MIG 29K fighters.500 Million first to be armed with the BrahMos-2. these are Kolkata.The Navy insists that the cost However. or USD Currently being built at MAZAGAON 1. last one to be delivered by 2021. VIRAAT is virtually operating on its last legs. It In total there will be 7 vessels.End 2008 or Early taking the total tally to 7. with the has undergone a major refit.k.500 million. followed by INS KOCHI in MAY Indigenous Aircraft Carrier. India These will be the first vessels to be built by the Plan to build 3 vessels. USD 622 Million. the Navy had insisted that the first 2 frigates be Strategic Advisory Services .780 Million. The navy has kept the –Russia option of 4 more vessels under this project. already under delivery. If India is to maintain its blue frigates being currently inducted. This project was preceded by the modernization at SEVERNOYE shipyard Delhi class of vessels. it is still running short of Harrier of each vessel be maintained in parity Jump Jets. Original Delivery. Carrier Base: KARWAR . Karnataka New delivery schedule is 2013. INS VIKRAMADITYA The first vessel will join the fleet only in 2012. enabling a life extension beyond 2009. lasting one year. The water projection.

Air Defence Ship .USD 1. Budget.Anticipated to be close to USD Delivery originally planned for 2012. Subsequently design changes however they are being built in India. then priced at roughly USD 444 Million. built abroad. which was not accepted by the Project 28 DAC. India. accusations of impropriety since the beginning.044 Million. The carrier was initially delayed due to Russia’s These vessels are similar to the ones being inability to supply the steel required for the delivered to the Chilean’s and the Malysian’s. programe. Delivery now planned for 2013 against Currently being built at MAZAGAON originally planned for 2010 DOCKS (MDL). with the date.555 Million. Budget originally estimated at USD 622 Budget. USD 1. Since these parts are crucial to the performance of the submarine. The latest news concerns crucial parts which It is now generally accepted that the delivery were to be bought from Aramis (original will take place only in 2015 vendor). now being quoted at USD 1.ADS Project 75 Currently under construction at Cochin Scorpene Submarine Shipyard (CSL). there was no Strategic Advisory Services . this has built in 2004 all delivered post the delivery led to a delay of almost 24 months. This is the first of the 2 planned Aircraft A total of 6 submarines are to be built in this Carriers to be completely indigenous. The including those impacting the length of the scorpene programme has been plagued by carrier caused further delays. first delivery now scheduled only in 2014. Progress is reported to be satisfactory despite These 4 Corvettes were planned to encourage Russia’s past track record not having been very the participation of the Indian industry in naval encouraging with the 3 Krivak class frigates ship building programmes. India. Russia. and the project cost has revved up to a staggering Project 71 USD 1. building. 2006. However. now scheduled for 2014 Delivery planned for 2012. Kaliningrad.555 Million. now revised to the contract signed in July. Currently being built at Yantar Delivery originally planned for 2012 Shipyard. 1. Anti Submarine Warfare Corvette (ASW) Project 11356 Currently 2 are being built at GARDEN Russian Krivak IV Class Frigates REACH Shipbuilders and Engineers (GRSE) Kolkata.600 Million reported for Million.700 million against USD 450 Million now slated for 2015 when planned. Budget at USD 3.500 Million.

However at its Delivery originally planned for 2008. halt. Project under technical evaluation of Delivery planned for 2011 bids submitted by Intermarine. The vessel is slated to join the Navy only 2011. South Korea are going through the technical evaluation process currently which is Shchuka-B . to be transferred to Indian Navy in early 2010 2 tankers ordered on Fincantieri. Italy and Kangnam Project 971 Shipyards. in spite of these difficulties. the Pondicherry class of MCMVs to be The first vessel of this programe was a phased out. South Korea 2 MCMVs to be bought.a. the now anticipated in 2011. Budget. and will eventually lease out to India by Advance Technology Vessel (ATV) .k. CHAKRA.USD 54 Million Strategic Advisory Services . Russian Navy inducted the NERPA in December 2009. Both Intermarine. its completion. killing 20 people onboard. Already inducted into the Russian Fleet Replenishment Tanker Navy. 2009. with the first SCORPENE now only slated However. Italy. INS Chakra anticipated to complete by early to mid 2010. Italy Budget unknown and Kangnam Shipyards. India. India had signed a contract with Russia for a 10 Delivery of the first tanker planned for year lease for this submarine and had paid for 2010. The programme was initially proposed in May This programe has a total of 5 nuclear 2004. submarines under it. Original Budget. This programme includes a total of 8 vessels. Italy. ARIHANT Mine Counter Measure Vessel (MCMV) Currently undergoing final fitment at Vishakapatnam.USD 650 Million First tanker currently being built at Liguria. the to be delivered by 2015. India was supposed to retire its ageing fleet of II class. ceremonial launch on 26th July. The design of these submarines is similar to the RUSSIAN CHARLIE. Technology Demonstrator. This has led the programe coming to a off by mistake. with 2 being bought off the shelf and the after almost 2 years of trials. A fire extinguishing system went earlier. Incidentally India had leased one such Pondicherry class of MCMV’s that have been in submarine in 1988 and re-christened it INS service since 1970-80. remaining 6 being built in India at GSL. rest to be built Arihant was positioned as India’s response in at GSL. Nuclear Reactor and other associated systems Original Budget: USD 1. competitive bidding and consequently the During a sea-trial in Novemeber 2008 in the prices of these components were not frozen Sea of Japan.INS the first half of 2010.000 Million were not onboard.K-152 Nerpa a. the field of a Miniature Heavy Water Nuclear These MCMVs are replacements for Reactor.

Religare Capital Markets Limited www. supply chain solutions in India and project management Any and all information contained herein is based on good faith assumptions and is provided for general information purposes only. Vice President Investment Banking The tankers would be 175m long and be capable of refueling 4 ships simultaneously. INDIA The maximum service speed would be 20knots. Our expertise lies in managing the exposures of global OEMs in India including specifically market entry. offset obligation fulfillment for the contract. District Centre.kuber@religare.) Sr. or guarantee of performance. This document should not be used or relied upon for any purpose other than as intended by Religare Capital Markets Limited. promise. Defence.45 . warranty. +91 (11) 3912 5052 which now seem to have been resolved. As of now. Col. Strategic Advisory Services Exchange Rate Assumption for all figures: 1USD = Rs.gangal@religare. This information does not constitute an offer. SAKET New Delhi Ankur Gupta Senior Manager Defence Advisory Services Ankur. there were issues wrt the +91 (11) 3912 5051. Kuber (Retd. management and execution of offset contracts. Nuclear and Homeland Security – advisory services and project management. Rahul Gangal Sr. the construction programe Telephone: is well on course.religare.gupta1@religare. K. Vice President Strategic Advisory Services Religare Strategic Advisory is the arm of Religare working in the space of Aerospace. 2 Tankers are to be built under this programme. V. +91 (11) 3912 5000 FAX: In 2008 and 2009.