INDIAN defence ministry has cleared a mega project to domestically build six conventional submarines for the Indian Navy for Rs 430 billion (£4.15bn).
This major step will significantly boost India's naval prowess in the face of rapid expansion of China's maritime capabilities.
The submarines will be built under the strategic partnership model that allows domestic players to join hands with leading foreign defence firms to produce high-end military platforms to reduce import dependence, government sources said.
The decision to approve the project named 'P-75 India' was taken at a meeting of the Defence Acquisition Council (DAC), the ministry's highest decision-making body on procurement, chaired by defence minister Rajnath Singh.
According to reports, the project will be implemented in 12 years and the final cost may go up depending on the weapons systems to be incorporated into these submarines.
The sources said the DAC approved the issuance of the Request for Proposal (RFP) or tender to shipbuilder Larsen & Toubro (L&T) and state-owned Mazagaon Docks Ltd (MDL).
They will have to respond to the RFP by tying up with one of the five already short-listed foreign shipyards-Rosoboronexport (Russia), Daewoo (South Korea), ThyssenKrupp Marine Systems (Germany), Navantia (Spain) and Naval Group (France).
The RFP is expected to be issued within a month and the contract will be awarded following a detailed evaluation of the responses of the L&T and MDL, sources said.
Groundworks such as specifications of the submarines and other critical requirements for issuance of the RFP for the project has been completed by the ministry and the Indian Navy.
The Indian Navy plans to acquire 24 new submarines, including six nuclear attack submarines, to bolster its underwater fighting capability. It currently has 15 conventional submarines and two nuclear submarines.
According to global naval analysts, the Chinese navy currently has over 50 submarines and about 350 ships. The total number of ships and submarines is projected to go past 500 in the next 8-10 years.
The Indian Navy is also in the process of procuring 57 carrier-borne fighter jets, 111 Naval Utility Helicopters (NUH) and 123 multi-role helicopters under the strategic partnership model.
Initially, the strategic partners will be selected in four segments - fighter aircraft, helicopters, submarines and armoured fighting vehicles/main battle tanks, and is expected to be expanded to other segments.
Last August, the defence minister announced that India will stop the import of 101 weapons and military platforms like transport aircraft, light combat helicopters, conventional submarines, cruise missiles and sonar systems by 2024.
A second negative list, putting import restrictions on 108 military weapons and systems such as next-generation corvettes, airborne early warning systems, tank engines and radars, was issued this week.
India's defence ministry has set an export target of Rs 350bn (£3.38bn) worth of military hardware in the next five years.
Bob Blackman MP speaks during the event