India to go ahead with $2.3 billion Turkish shipyard deal for FSVs

India is going ahead with a $2.3 billion (about Rs 15,000 crore) deal to manufacture fleet support vessels (FSVs) in collaboration with a Turkish shipyard following a review after questions were raised on Turkey’s links with Pakistan and the recent diplomatic tiff with the Recep Tayyip Erdogan government.

The formal contract was signed days after India issued a strong statement rejecting all references made to Jammu and Kashmir in a joint declaration by Turkey and Pakistan during President Erdogan’s visit to Islamabad last month. Turkey’s TAIS had emerged as the lowest bidder for a contract to manufacture five of the 45,000-tonne FSVs at the Vizag-based Hindustan Shipyard Limited (HSL) last year, but the contract signing was put on hold in October following the repeated raising of Kashmir issue by Erdogan at international forums.

The contract was signed by HSL last month after clearances were given by the Ministry of Defence (MoD), said people aware of the matter. They said the Ministry of External Affairs was also consulted before the decision was taken.HSL had been keen to resolve the matter at the earliest and had written several letters to the defence ministry over the past few months. “MoD has directed HSL to put the project on temporary hold in view of recent diplomatic developments with Turkey. HSL inputs regarding the legal and financial implications of cancelling the bid of M/s Anadolu shipyard have been submitted to the MoD,” the ministry told the parliamentary standing committee on defence.

The defence ministry’s vigilance department was asked to review the order and gave a go-ahead, said one of the persons, who did not wish to be identified. Similarly, inputs were received from MEA on diplomatic implications, after which it was decided to proceed with the Turkish collaborator. The contract was signed last month after the defence ministry removed its temporary hold order.

The Indian FSV project was initially given a go-ahead in 2016 after the Navy projected a requirement for ships that could carry fuel and other supplies for warships at sea.

As reported by ET, Turkish shipyards are a major supplier of warships to the Pakistani Navy and concerns had been raised on how access to the strategic HSL by its engineers and workers could result in serious security issues. HSL is located close to the Ship Building Centre, where India’s nuclear armed submarines are built, as well as the Eastern Naval headquarters.

Besides four new corvettes, Turkey has designed a fleet support vessel for Pakistan, supports its submarine fleet and has signed a deal to sell 30 T-129 attack helicopters that have been developed in collaboration with Italian company Finmeccanica (since renamed as Leonardo). In September last year, Erdogan had used the ceremony to launch new corvettes for the Pakistani Navy. Last month, he raised the Kashmir issue again and attempted to draw similarities to the Palestine conflict.

Since then, the Turkish President has visited Pakistan, where he repeatedly raised the Kashmir issue and said that Turkey was on Pakistan’s side over the conflict and that it would support it on the issue of being censored by the Financial Task Force as well. Following Erdogan’s visit in February, India issued a strong statement and on March 3 made a strong demarche with the Turkish envoy as well.

 economictimes