Pipavav Defence & Offshore Engineering Co Ltd has formed a joint venture with one of the biggest ship repairing centre in Russia — JSC Ship Repairing Centre Zvyozdochka.
The venture, in which Pipavav will hold 51 per cent stake, has been created for medium refits and life certification of 877 EKM Submarines in India.
The indicative value of work proposed to be undertaken by the proposed JV is ₹11,000 crore.
“The skills and experience developed by the joint venture will position Pipavav Defence favourably for undertaking similar work for large submarine forces of similar class deployed by countries like Algeria, Vietnam and Iran, with potential additional revenues of approx. ₹20,000 crore,” said a press statement.
This is the first time the work for refit of submarines is being considered for the private sector in India.
Under the terms of the agreement, Zvyozdochka will provide complete technical assistance and support to the JV, including enhancement of infrastructure at the Pipavav Defence facilities and training of engineers. Pipavav Defence technicians will also be closely associated with the first refit to be carried out in Russia.
A refit in India has several advantages, of which the most important are savings on transportation costs to Russia and back, and the enhanced operational availability of the submarines for thousands of additional hours, by avoiding the downtime in transporting them to Russian and back.
Zvyozdochka, founded in 1954, undertakes repair and upgradation of warships and submarines of the Russian Navy.
So far, it has undertaken upgradation and refurbishment of more than 120 submarines and 90 warships.
This is the first major deal for Pipavav after it was acquired by Anil Ambani-backed Reliance Infrastructure Ltd.
The Zvyozdochka team had conducted a survey of all shipyards in India, both in the public and private sector, before zeroing in on Pipavav.