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India’s Multi-billion Dollar Scorpene Sub Contract (Updated)

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India’s Multi-billion Dollar Scorpene Sub Contract (Updated)

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India’s submarne fleet currently consists of 16 submarines, about 13 of which are operational. Its Foxtrot Class boats can no longer be counted on, and its U209 derivatives from HDW are unlikely to last beyond 2015. With Pakistan acquiring modern submarines, and Chinese submarine building exploding, serious thought to India’s future submarine fleet became an obvious priority. In 2005, Indian Prime Minister and chairman of India’s Cabinet Committee on Security Manoham Singh confirmed is country’s decision. India would buy 6 Franco-Spanish Scorpene diesel submarines, with an option for 6 more and extensive technology transfer agreements. This is one of the biggest military deals India has entered into with France, and is intended to both modernize India’s submarine fleet and re-start India’s own industrial capabilities.

The Scorpene deal simmered on the back-burner for several years. DID reported that a deal was “close” back in December 2004, but nothing was finalized until late 2005. The cost had been subject to varying estimates over the life of those multi-year negotiations, but the final figure for the first 6 boats is now generally accepted as being about $3.5 billion.
 
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Indian Navy faces delay to Scorpene project
The Indian Navy has confirmed that the indigenous construction of six French-designed Scorpene submarines is likely to be hit by delays. Commander Nirad K Sinha, the Indian Navy's official spokesman, told Jane's on 29 May that he could "neither confirm nor deny" reports that a delay in receiving technology from France would hold up the USD3.5 billion project by one year

[first posted to Jane's Defence Weekly - Your first line of defence - 30 May 2008]
 
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DCNS to Abide by Full Transfer of Technology Contractual Obligation
Dated 18/7/2008

French warship major DCNS says it will fully transfer technology for its Scorpene submarines that are being built in this country for the Indian Navy and that the six boats contracted for will be delivered on schedule by 2017.

"Transfer of technology is not an issue. We will fully abide by our contractual obligations and even go a step further by providing equipment that has not even been asked for but will aid in the construction of the submarines," said DCNS chairperson and CEO Jean-Marie Poimboeuf. "We have already started to transfer technology. This is a big challenge but we are totally confident we will achieve what we have set out to do," Paris-based Poimboeuf told IANS in an interview here.

India and France had in 2005 signed a Rs.130 billion ($3 billion) deal for six Scorpene submarines armed with Exocet anti-ship missiles. It was originally thought that one of these would be in sail-away condition while the remaining five would be manufactured at the state-owned Mazgaon Docks Limited (MDL) at Mumbai. It now transpires that MDL would build all the six vessels. "There is no restriction at all from the French government (on transferring technology)," Poimboeuf pointed out.

The official is here for a visit he undertakes every six months to monitor the progress in the construction of the first Scorpene submarine at MDL, which began last year. He has also interacted with defence ministry officials on future contracts - including for the next generation Scorpenes that will be capable of firing long-range air-breathing missiles.

Discussing the challenges in transferring technology, Poimboeuf said this was because the wheel had virtually to be reinvented in training Indian engineers and technicians for the job at hand. "We had to start from scratch because whatever expertise India had acquired in building submarines had been lost as no boats have been constructed for nearly 20 years," Poimboeuf explained.

The last time a submarine was built in India was in the late 1980s when MDL constructed under licence two German HDW boats, in addition to two that the Indian Navy had purchased in sail-away condition. MDL was to have constructed a total of four boats but the contract was abruptly terminated following charges that HDW had paid massive kickbacks to secure the Rs.4.20 billion deal. The four HDW submarines in the Indian Navy's fleet of 16 boats will approach the end of their combat life between 2016 and 2024.

"Today, there is a new generation (of Indian engineers and technicians). We have to start from scratch in training them and are very serious about this," Poimboeuf said. Toward this end, DCNS has deployed 15 French engineers at MDL against the six it was obligated to and plans to raise the number to 30 as the project proceeds.

It is also opening a fully owned-subsidiary in Mumbai next month to speed up the technology transfer process and to involve Indian industries by way of joint ventures or outsourcing. "The subsidiary would not only support the submarine project but work with local companies to indigenise the boats," Poimboeuf explained. Speaking about the construction of the first Scorpene, he said its various sections were being built and after integration of the systems they would carry, they would be put together by the end of the year.

"The full integration of all the systems would take another three years, after which sea trials would be conducted over a period of 12-18 months before the vessel is declared fully operational by 2012," DCNS Vice President (Projects) Pierre Legros explained.

DCNS to Abide by Full Transfer of Technology Contractual Obligation | India Defence
 
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DCNS to Abide by Full Transfer of Technology Contractual Obligation
Dated 18/7/2008

French warship major DCNS says it will fully transfer technology for its Scorpene submarines that are being built in this country for the Indian Navy and that the six boats contracted for will be delivered on schedule by 2017.

"Transfer of technology is not an issue. We will fully abide by our contractual obligations and even go a step further by providing equipment that has not even been asked for but will aid in the construction of the submarines," said DCNS chairperson and CEO Jean-Marie Poimboeuf. "We have already started to transfer technology. This is a big challenge but we are totally confident we will achieve what we have set out to do," Paris-based Poimboeuf told IANS in an interview here.

India and France had in 2005 signed a Rs.130 billion ($3 billion) deal for six Scorpene submarines armed with Exocet anti-ship missiles. It was originally thought that one of these would be in sail-away condition while the remaining five would be manufactured at the state-owned Mazgaon Docks Limited (MDL) at Mumbai. It now transpires that MDL would build all the six vessels. "There is no restriction at all from the French government (on transferring technology)," Poimboeuf pointed out.

The official is here for a visit he undertakes every six months to monitor the progress in the construction of the first Scorpene submarine at MDL, which began last year. He has also interacted with defence ministry officials on future contracts - including for the next generation Scorpenes that will be capable of firing long-range air-breathing missiles.

Discussing the challenges in transferring technology, Poimboeuf said this was because the wheel had virtually to be reinvented in training Indian engineers and technicians for the job at hand. "We had to start from scratch because whatever expertise India had acquired in building submarines had been lost as no boats have been constructed for nearly 20 years," Poimboeuf explained.

The last time a submarine was built in India was in the late 1980s when MDL constructed under licence two German HDW boats, in addition to two that the Indian Navy had purchased in sail-away condition. MDL was to have constructed a total of four boats but the contract was abruptly terminated following charges that HDW had paid massive kickbacks to secure the Rs.4.20 billion deal. The four HDW submarines in the Indian Navy's fleet of 16 boats will approach the end of their combat life between 2016 and 2024.

"Today, there is a new generation (of Indian engineers and technicians). We have to start from scratch in training them and are very serious about this," Poimboeuf said. Toward this end, DCNS has deployed 15 French engineers at MDL against the six it was obligated to and plans to raise the number to 30 as the project proceeds.

It is also opening a fully owned-subsidiary in Mumbai next month to speed up the technology transfer process and to involve Indian industries by way of joint ventures or outsourcing. "The subsidiary would not only support the submarine project but work with local companies to indigenise the boats," Poimboeuf explained. Speaking about the construction of the first Scorpene, he said its various sections were being built and after integration of the systems they would carry, they would be put together by the end of the year.

"The full integration of all the systems would take another three years, after which sea trials would be conducted over a period of 12-18 months before the vessel is declared fully operational by 2012," DCNS Vice President (Projects) Pierre Legros explained.

DCNS to Abide by Full Transfer of Technology Contractual Obligation | India Defence

Expect delays. It puzzles me to assign an intermediary between the MoD and DCNS every six months. To me that reeks of a breakdown in communication as usually the vendor is directly capable of face-to-face communication on every issue with the client.
 
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DCNS India - DCNS Sets Up Indian Subsidiary in Mumbai

Mumbai: Patrick Boissier, Chairman & CEO of DCNS Group, a European leader in naval systems, inaugurated DCNS India, a wholly-owned subsidiary specialising in naval services in Mumbai on March 25.

DCNS Group is in charge of a contract for the transfer of technology of Scorpene submarines to Mazagon Dock Ltd (MDL) shipyard. Six Scorpene submarines will be delivered by 2018 under P75 Indian Navy's project. DCNS India will contribute to this technology transfer by providing consultancy and technical assistance services and by helping to source and qualify Indian suppliers for submarine components and equipment.
Additionally, DCNS India will conduct detailed engineering studies and provide consultancy, sourcing and procurement services for other DCNS projects with Indian shipyards. It also plans to provide similar services to DCNS units abroad.

Mr. Xavier Marchal will be the Managing Director of DCNS India. He was associated with Indian Navy's P75 project since its commencement 3 years back. The new entity is headquartered in Mumbai and expects to employ over 100 people by the end of 2010.

Mr. Patrick Boissier, Chairman & CEO of DCNS Group said, "I am pleased to formally announce the launch of Indian subsidiary of DCNS group. India is one of the key strategic focus markets for DCNS group and we are looking at it from a very long term perspective. We hope to make significant contribution through our global experience and expertise to the Indian companies and will be able to add a lot of value through our technical know-how and programme management capabilities."

The launch of DCNS India reflects the group's commitment to step up its international development and strengthen its presence in India in particular, primarily by facilitating the technology transfer process and establishing long-term ties with the local engineering and manufacturing industry, both public and private sectors.

DCNS India opening ceremony was attended by prominent members of the Indian Navy and naval industry.

The DCNS Group is one of Europe's leading players on the world market for naval defence systems. To meet customer demands for more comprehensive and integrated systems, DCNS acts as prime contractor for naval shipbuilding, integration and support by combining its own development, marketing and production capabilities with those of selected partners. To manage the complexity of such projects, the Group draws on in-house expertise in naval architecture and systems engineering, ship assembly and integration and equipment design and production, as well as through-life support. The DCNS Group employs 13,000 people and generates annual revenues of around €2.8 billion.
 
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Navy’s sub project slips on time, climbs on cost

NEW DELHI: In a major blow to Navy's already shrinking underwater combat capabilities, the mammoth Rs 18,798 crore project to construct six Scorpene
submarines at Mazagon Docks Ltd (MDL) in Mumbai has now slipped around two years behind schedule.


Defence ministry sources say the latest assessment shows the delivery of the first submarine, initially scheduled to roll out by December 2012, would not be possible before end-2014.

Moreover, the entire project is going to be hit with a huge cost escalation, which will take total costs much beyond Rs 20,000 crore, because France is demanding virtually double the money to supply some critical equipment to MDL.

"Negotiations for these `MDL procured material packages', which include almost everything other than combat systems, have been underway for a year now. The French say costs have doubled since the contracts were inked in October 2005,'' said a source.

"Consequently, though submarine hulls are being fabricated in MDL, there is nothing to put inside them at present. MoD has now approached the Cabinet Committee on Security for fresh approval for the cost escalation,'' he added.

The October 2005 contracts with French companies include the Rs 6,135 crore one with M/s Armaris (DCN-Thales joint venture) for transfer of technology, combat systems and construction design, and Rs 1,062 crore with M/s MBDA for sea-skimming Exocet missiles.

A Rs 5,888-crore contract was also signed with MDL for indigenous submarine construction, with another Rs 3,553 crore earmarked for taxes and Rs 2,160 crore towards other items to be acquired during the project.

Navy, on its part, hopes the lost time can be made up to some extent if the approvals come quickly for the Project-75 Scorpene project. All the six submarines were to be initially delivered by December 2017, one per year beginning from 2012.

A big delay will hit Navy hard since its projections show it will be left with only nine out of its present fleet of 16 diesel-electric submarines — 10 Russian Kilo-class, four German HDW and two Foxtrot — by 2012.

As it is, the Foxtrot submarines are obsolete now, and the number could further dip to just five by 2014. This is alarming since both Pakistan and China are rapidly augmenting their underwater combat capabilities.

After inducting three French Agosta-90B submarines, with the last one PNS Hamza even having air-independent propulsion (AIP) to boost its operational capabilities, Pakistan is now looking to acquire three advanced Type-214 AIP-equipped submarines from Germany.

China, of course, is way ahead. It has 62 submarines, with around 10 of them being nuclear-propelled, and at least one Xia-class and two Jin-class being SSBNs (nuclear submarines with long-range ballistic missiles).

Though India has also begun its hunt for six more new-generation submarines under Project-75A, worth over Rs 30,000 crore, it will take "several months'' before even the global tenders (request for proposals) are floated for them.

"Initial information obtained from Russian (Rosoboronexport), French (Armaris) and German (HDW) firms, among others, are being studied at present. We want P-75A submarines to have a high degree of stealth, land-attack capability and AIP,'' said an official.

There is also the indigenous secretive ATV (advanced technology vessel) programme, under which the first of the three nuclear-powered submarines being built is to be "launched into water'' on August 15.

But a fully operational ATV, with SLBM (submarine-launched ballistic missile) capabilities, is at least three years away. Navy, incidentally, will also get the Russian 12,000-tonne Akula-II nuclear-powered attack submarine on a 10-year lease by this year-end.
 
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Govt informs LS of impact in the late delivery of Scorpenes
New Delhi, July 20 Government today said that the delay in delivery of the Scorpene submarines is likely to impact the underwater capabilities of the Indian Navy.

" Delay in scheduled delivery of the submarines is likely to have an impact on the envisaged submarine force levels," Defence Minister A K Antony said in reply to a Lok Sabha query.

He added that slippages in the delivery schedule of Scorpene submarines was expected due to problems in absorption of technology and delays in augmentation of industrial infrastructure as well as procurement of material by the Mazagon Dockyards Limited (MDL), where the attack submarines are being constructed.

The Defence Minister said that as per the schedule, the first submarine was supposed to be delivered in 2012 and thereafter, one each was to be delivered till 2017.

In 2004, India had signed a deal worth Rs 18,000 crore for construction of six Scorpene submarines with France. All the six were supposed to be constructed at Mumbai-based MDL with the help of French company DCNS.

Meanwhile, replying to another query, Antony said that the indigenously manufactured Light Combat Aircraft (LCA) would be inducted into the Indian Air Force from 2010-11.
 
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India’s Multi-billion Dollar Scorpene Sub Contract

Latest Update

April 15/13:

More delays and costs coming. The Times of India reports that bureaucratic delays by the Ministry of Defence may force Scorpene submarine deliveries to start in 2016, even as costs are set to rise again:

“According to sources, Mazagon Dock Limited (MDL) has informed the Navy that the project would be delayed by another 18 months…. Consultants from Navantia, the Spanish shipbuilding company, left the project in the last few days. The technical assistance pact for Navantia and DCNS, the French partner in the consortium, expired on March 31, sources said. With MDL failing to get the defence ministry’s approval in time, about 10 Spanish consultants working on the submarine project left India…. DCNS leadership is expected to meet with MDL top brass this week in Mumbai and present their own demand for additional technical assistance fee.”

Every problem listed here was preventable, and so is the crisis coming to India’s submarine force. A contract that built the first 2 boats abroad, with Indian engineers and specialists working at the foreign shipyard before transferring home to build the last 4 at MDL, would have cut technical assistance requirements, while delivering working submarines to the navy for training and initial deployments. India’s Navy has learned that lesson, and is lobbying hard for an analogous arrangement under Project 75i. Based on reports to date, the ministry hasn’t learned anything and is resisting. Its political leaders would rather have the vote bank of state run jobs, and their associated financial arrangements up and down the supply chain, even if it costs more and leaves India strategically vulnerable. Somehow, that isn’t corruption.


https://www.defenseindustrydaily.co...n-dollar-scorpene-sub-contract-updated-01194/
 
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India’s Multi-billion Dollar Scorpene Sub Contract

Latest Update:

July 23/13:

Late, again. MDL Chairman and Managing Director Rear Admiral Rahul Kumar Shrawat (ret.) confirms to The Hindu that “We have set a new target of September 2016 for delivery of the first Scorpene,” instead of the already-late date of 2015. Deliveries were originally slated to begin in 2012, and the latest confession won’t win many fans in the Indian Navy. The Hindu external link:

“The Navy, however, is livid over the yard’s persistent disregard for deadlines. Top Navy officials rue that by the time the Scorpenes are commissioned, they would be obsolete. The first three Scorpenes will not even have air independent propulsion (AIP)…. MDL’s long-drawn procurement processes and sluggishness in technology absorption gave the projects hiccups at the start itself. Meanwhile, the project cost grew exponentially from the original Rs.18,798 crore to Rs. 23,562 crore in 2010 with a renewed timeline.”

Score another one for India’s “indigenization” drive. Prudent planning for a strategic asset would have built the first couple of submarines abroad. That would have given India a couple of new boats in the water by now, alongside lower project costs, MDL engineers trained in the original manufacturer’s shipyard, and options to shift some construction abroad if local delays became dangerous to national security.

https://www.defenseindustrydaily.co...n-dollar-scorpene-sub-contract-updated-01194/
 
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