India and Germany are on the verge of concluding a landmark defense agreement valued at approximately $8 billion, focusing on the joint construction of advanced conventional submarines for the Indian Navy. The proposed deal is expected to feature prominently during the upcoming official visit of German Chancellor Friedrich Merz to India, signaling a major step forward in bilateral strategic and industrial cooperation.
If finalized, the agreement would represent one of the largest defence contracts ever signed between India and Germany, significantly strengthening defence ties between the two countries while advancing India’s long-term naval modernization goals. The deal is also aligned with New Delhi’s broader push to enhance domestic defence manufacturing under the Make in India and Aatmanirbhar Bharat initiatives.
Submarine Project Under India’s Project-75(I)
The proposed collaboration falls under Project-75(I), India’s ambitious programme to acquire six next-generation diesel-electric submarines equipped with Air-Independent Propulsion (AIP) technology. These submarines are designed to operate silently for extended periods underwater, providing a critical strategic advantage in modern naval warfare.
Germany’s ThyssenKrupp Marine Systems (TKMS), one of the world’s leading non-nuclear submarine manufacturers, is expected to partner with Mazagon Dock Shipbuilders Limited (MDL), a state-owned Indian shipyard with extensive experience in building submarines and warships for the Indian Navy.
Under the proposed structure, the submarines would be constructed in India, with substantial transfer of technology, design support, and engineering expertise from Germany. This approach aims to deepen India’s indigenous shipbuilding capabilities while ensuring access to proven and reliable submarine technology.
Strategic Importance for the Indian Navy
The Indian Navy has been seeking to modernize its underwater fleet amid growing security challenges in the Indian Ocean Region. With a number of ageing submarines approaching the end of their operational life, the induction of advanced AIP-equipped vessels is seen as essential to maintaining maritime deterrence and safeguarding sea lines of communication.
The new submarines are expected to enhance India’s ability to conduct intelligence, surveillance, and reconnaissance missions, as well as anti-surface and anti-submarine warfare operations. Their stealth, endurance, and operational flexibility would significantly bolster India’s naval posture in a region witnessing increasing strategic competition.
Boost to Defence Manufacturing and Employment
Beyond its military significance, the deal is expected to deliver substantial economic and industrial benefits. Local construction of the submarines would support job creation, strengthen India’s defence supply chain, and enable Indian companies to integrate into global naval manufacturing ecosystems.
The partnership model emphasizes long-term industrial cooperation rather than a one-time purchase, positioning Indian shipyards and vendors to participate in future submarine maintenance, upgrades, and potential exports. For Germany, the deal would secure a major foothold in India’s expanding defence market and reinforce its role as a key strategic partner.
Broader India–Germany Strategic Engagement
The submarine negotiations are part of a wider effort to elevate India–Germany relations across defense, trade, technology, and clean energy sectors. Both countries have been working to expand cooperation in critical technologies, advanced manufacturing, and supply chain resilience.
Chancellor Merz’s visit is expected to include high-level discussions on trade facilitation, investment flows, and collaboration in strategic industries. Defence cooperation, particularly in high-technology platforms such as submarines, is increasingly viewed as a cornerstone of the evolving bilateral partnership.
Timeline and Next Steps
While significant progress has reportedly been made, officials have indicated that final contract signing may take additional time, as negotiations continue on pricing, technology transfer, and regulatory approvals. However, the political momentum surrounding the visit has raised expectations that a formal announcement or major breakthrough could be achieved in the near term.
Once concluded, the agreement would mark a transformational moment in India’s submarine acquisition programme and set a new benchmark for defence collaboration between India and European partners.
Conclusion
The proposed $8 billion India–Germany submarine deal reflects a convergence of strategic interests, industrial ambition, and geopolitical realities. By combining German technological expertise with Indian manufacturing capacity, the partnership has the potential to reshape India’s naval capabilities while deepening one of Europe’s most important defence relationships in Asia.
As discussions advance, the deal is being closely watched by defence analysts and industry stakeholders, given its implications for regional security, global defence markets, and the future trajectory of India–Germany strategic cooperation.
