Setback For Indian Navy As MoD Cancels 2016 Proposal To Buy Specialised Vessels

The Indian Navy’s urgent bid to acquire 12 mine counter measure vessels (MCMVs) suffered another setback earlier this month when the ministry of defence (MoD) cancelled a 2016 proposal from South Korea’s Kangnam Corporation.

MCMVs are specialised vessels designed to locate and destroy sea mines planted by enemy aircraft and submarines in a bid to blockade harbours. The navy’s minesweeper fleet of 12 ships-acquired in the 1970s and ’80s from the former Soviet Union-is on its last legs, having dwindled to just four units after older ships were retired. The MoD scrapped the deal after the South Korean shipyard reportedly demanded $1 billion to transfer technology to Goa Shipyard Ltd (GSL), where the vessels were to be built. The entire acquisition process will now be rebooted with the MoD likely to put out a fresh Expression of Interest (EoI) to global vendors for MCMVs. This will be the third attempt to acquire these vessels in a decade. Kangnam had earlier finished as the lowest bidder in a 2005 process to buy eight MCMVs. The acquisition bid was scrapped in 2015 after the South Korean firm was found to have hired agents, banned under MoD rules. The Korean corporation was then nominated as a single vendor to build the MCMVs at the GSL in 2016, which officials say, led to a monopolistic situation. Read More…

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