Anil Ambani-controlled Reliance Defence Ltd and Russian United Shipbuilding Corp. may build four frigates for the Indian Navy for around Rs.30,000 crore.
The proposal to build four Talwar class frigates will be on the agenda of the 16th Annual Summit between India and Russia in Moscow on Thursday, according to two company executives.
These ships, if an agreement is reached, will be built at Reliance’s recently acquired shipyard at Pipavav in Gujarat. Reliance Defence will also enter into an agreement with the Russian shipmaker for a partnership to refit and modernise Indian Navy’s ships of Russian origin at Pipavav yard, one of the executives said. Both declined to be named.
There are 35 Russian ships in the Indian Navy, the executive said. Mint couldn’t independently verify this. In June, Reliance Group’s Pipavav Defence and Offshore Engineering Co. Ltd and Russia’s JSC Ship Repairing Centre Zvyozdochka agreed to jointly refit and certify submarines at an estimated Rs.11,000 crore.
Pipavav Defence had said the company proposes to execute the programme in a joint venture with the Russian firm, in which it will hold 51% stake. Prime Minister Narendra Modi’s emphasis on defence equipment manufacturing in his Make in India initiative has led several companies to scramble for permits.
Last month, Reliance Defence secured initial approvals for 12 industrial licences from the department of industrial policy and promotion (DIPP) to manufacture aircraft, helicopters, unmanned aerial vehicles, all-terrain combat vehicles, night-vision devices, sensors, navigation and surveillance equipment, propulsion systems and simulators.
On 4 November, Reliance Infrastructure’s board said new high-growth opportunities in the defence sector, arising from the Make in India and Skill India programmes serve vital national priorities and have several attractive features.
The board said these include relatively low capital intensity, low gestation, minimal regulatory uncertainties, higher job creation and the potential for better return on equity.