India to order eight minesweepers from South Korea

(  The Economic Times) :  India is all set to place an order with a South Korean shipyard for building eight minesweepers for its navy in its quest to overhaul its existing fleet of such specialised warships, defence ministry sources say.

The ministry has zeroed in on Pusan-based Kangnam Corporation as the lowest bidder that is technically qualified to execute the order for which Italian firm Intermarine was among the shortlisted companies.

"The defence ministry has initiated cost negotiations with Kangnam Corporation that is expected to be completed in a month or two, when the order will be finally placed," a senior defence ministry official told IANS.

Though the final price is yet to be fixed, it is likely to be in the region of Rs.3,000 crore ($670 million) for each of the eight warships, defence ministry sources have indicated.

As per the tenders for the Mine Counter-Measure Vessels (MCMV), Kangnam will be asked to build the first two warships, following which Goa Shipyard Limited will be commissioned to build the rest six minesweepers under licensed technology transfer.

Minesweepers are specialised warships capable of detonating sea mines.

These eight vessels will be capable of playing the roles of both minesweepers and minehunters and hence will lie somewhere in between the two in terms of its capabilities, the official said.

The contract, which was originally scheduled for signing this month, got delayed as the Kangnam's competitors went to the Central Vigilance Commission (CVC) against its selection.

But after the defence ministry and the navy explained the rationality of Kangnam's selection as the lowest bidder to the CVC, the matter was settled and the cost negotiations are now progressing well, he added.

The navy currently operates 12 minesweepers of the Pondicherry/Karwar class that are equally divided between the two operational Mumbai-based Western Naval Command and Visakhapatnam-based Eastern Naval Command for deployment.

The Pondicherry/Karwar class of warships, built in the 1970s and 1980s, are fast approaching obsolescence and need to be replaced within this decade.

Kangnam will deliver the first two MCMVs by 2016 and Goa Shipyard Limited will complete its side of the contract by 2018.

The navy is also considering buying two used Osprey-class minesweepers from the US that were decommissioned by the US Navy in 2007. The US Congress has already cleared the prospective sale of these two vessels to friendly countries.

The Obama administration had in 2010 offered these two minesweepers to India, which had expressed its interest in acquiring them in April 2005