India and South Korea—Special Strategic Partnership

The main edifice of the MoU rests upon developing and strengthening defence industry cooperation which will recommend the organisations for collaborating in core warship building projects

Issue: 3 / 2017By Rear Admiral Sushil Ramsay (Retd)Photo(s): By PIB
A.K. Gupta, Secretary (Defence Production) and Chang Myoung-Jin, Minister of Defence Acquisition and Programme Administration, Republic of Korea, exchanging an Inter-Governmental MoU for Defence Industry Cooperation in Shipbuilding, in New Delhi on April 21, 2017

Signing of the memorandum of understanding (MoU) between India and South Korea on April 21, 2017, signified a major turn in the growing bilateral relationship between the two countries. Whilst the instant MoU signed was for defence industry cooperation in shipbuilding, there was another important development by way of signing of contract between Indian company Larsen & Toubro (L&T) and South Korean company Hanwha Techwin to jointly manufacture a 155mm, 52-calibre gun, mounted on a tracked, armoured vehicle for the Indian Army.

Around the same time there was yet another important development reported that the beleaguered design consultancy and technological assistance for construction of 12 mine countermeasure vessels (MCMVs) from Kangnam Corporation of South Korea to the Goa Shipyard Limited was at the advance stages of negotiations and likely to be concluded by the end of this year.

Cooperation in Shipbuilding

The MoU for defence industry cooperation in shipbuilding was signed by India’s Secretary Defence Production Ashok Kumar Gupta and South Korean Defence Acquisition and Programme Administration Minister Chang Myoung-Jin. The main edifice of the MoU rests upon developing and strengthening defence industry cooperation which will recommend the organisations for collaborating in core warship building projects. The salient points of the MoU are as follows:

  • Develop and strengthen defence industry cooperation between the Republic of India and the Republic of Korea.
  • The two sides will recommend the organisations for collaborating in the implementation of specific projects.
  • The organisations recommended for cooperative projects may conclude separate agreements (contracts) between them to implement the specific projects.
  • The MoU will come into effect from the date of signature by both sides and will be initially valid for a period of five years and would be automatically extendable for further successive five year at a time.

The provisions of the MoU are expected to provide desired impetus and boost to the Indian Government’s flagship initiative of ‘Make in India’ in the shipbuilding sector. This policy initiative flows out of the overall umbrella of the ‘Special Strategic Partnership’ seeded through the Joint Statement made by the Prime Minister of India and the former President of South Korea, during the former’s visit to Seoul during May 2015. Towards implementation of the long-term vision on the Special Strategic Partnership, the Cabinet Committee on Security had accorded its approval for the MoU and nominated the Hindustan Shipyard Limited (HSL) in Visakhapatnam from the Indian side for the collaboration. In consonance, the Government of South Korea is empowered to nominate a shipbuilding organisation on their side for the said collaboration.

Hindustan Shipyard Limited

The Government of India under the said MoU has authorised building of five Fleet Support Ships (FSS) at an estimated cost of Rs. 10,000 crore (about $1.56 billion). These FSS will replenish ammunition, fuel, food and supplies to Indian Navy’s (IN) ships and fleets deputed for overseas deployments far away from its base ports. As per available reports South Korea has desired to build the first FSS in their own country and the balance four to be constructed at HSL, whereas the Indian side wishes to build all of five FSS at HSL.

The most vital aspect of the MoU is the agreement for Seoul to nominate a South Korean shipyard to upgrade and modernise the infrastructure and ancillary facilities at HSL for the shipyard to execute the naval warship building projects in an efficient, timely and cost-effective manner. HSL would be able to imbibe the best practices in shipbuilding leading to effective project management. This important development will be a shot in the arm of HSL, a public sector entity which was transformed as the ‘Defence Shipyard’ in February 2010. Post its modernisation and upgrades HSL will be expected to win the high-value orders which will eventually place it on a firm financial footing.

Optimism on the turnaround of HSL was evident when in a recent claim by Rear Admiral Sarat Babu (Retd), Chairman & Managing Director of HSL, said after years in the red that HSL would, for the first time, make an operating profit of Rs 30 crore, on a turnover of Rs. 625 crore in 2016-17.

It is reported that HSL would enter into partnership agreement to build the FSS with a globally renowned South Korean shipyard, probably part of Hyundai Heavy Industries. Interestingly, the FSS order will be the second cooperative project between HSL and a South Korean shipyard. In the early 1990s, HSL and Korea Tacoma cooperated to build seven offshore patrol vessels (OPVs) of Sukanya class. First three of these OPVs were built in South Korea and the balance four at HSL, and all OPVs are still in service. One of the OPVs built at HSL, INS Sarayu, was sold to the Sri Lankan Navy, where it continues to perform the role of flagship and is rechristened as SLN Sayura.

Modernisation and upgrading of infrastructure will certainly pave way for the shipyard to undertake construction of different classes of warships and submarines. The strategic location of HSL on the eastern seaboard of India makes it eminently suitable to build lethal platforms for the Indian Navy to significantly contribute towards its force structuring. The modernisation of HSL is significant as it holds promises of new vistas for HSL to emerge as a fourth potent Defence Shipyard of the country.

Mine Countermeasure Vessels

In addition to the above project, Kangnam Corporation of South Korea is slated to provide consultancy, design and technological assistance to India’s public sector defence shipyard, Goa Shipyard Limited (GSL) in building 12 MCMVs. The available reports suggest that this deal between and Kangnam Corporation could be concluded by fourth quarter of this year.

The MCMV project envisages construction of 12 vessels at GSL in collaboration with Busan, South Korea-based Kangnam Corporation under the ‘Make in India’ initiative at a cost of Rs. 32,000 crore (about $5billion). Though the deal was supposed to be closed last year, discussions on technology transfer to India caused some delays.

Commenting upon the progress of the beleaguered project, Rear Admiral Shekhar Mittal (Retd), Chairman & Managing Director of GSL, has said, “We are working hard to conclude the contract this financial year. Technology transfer is a complex issue and both sides have to be satisfied. Ironing out the details took some time.“ Until now, the GSL has spent Rs 800 crore on scaling up infrastructure to commence construction of MCMVs. Facilities are being created for building glass-reinforced plastic hulls, a design that reduces the ship’s magnetic signature and allows safer navigation through mine infested waters.

All 12 vessels will be constructed in India, and are expected to have 60 per cent indigenous content. The construction of the first vessel is expected to begin in April 2018, and deliveries will be completed between 2021 and 2026. The minesweepers will have a displacement of 800 tonnes to 1,000 tonnes. The Indian Navy needs to fill wide gaps in its mine warfare capability. Its present MCMV force consists of six vessels which were acquired from the erstwhile Soviet Union in the late 1970s. To build a credible MCMV force it is estimated that Indian Navy would require 24 minesweepers.

Mines are deployed to limit the enemy’s ability to use the sea. These underwater weapons can detonate on contact, or be activated by magnetic and acoustic signatures. Minesweepers are used to keep sea lanes mine-free and destroy minefields near enemy shores while undertaking offensive action.

After scrapping an earlier tender to import minesweepers due to alleged irregularities, the Government of India nominated GSL in February 2015 to construct MCMVs in partnership with a foreign shipyard for giving an impetus to the ‘Make in India’ programme.

Self-Propelled Field Guns

In addition to two projects on the naval side, L&T of India has recently signed a contract with Hanwha Techwin of South Korea for jointly building in India 100 self-propelled artillery guns, worth Rs. 5,000 crore (about $0.78 billion).

The K-9 Vajra-T gun that L&T and Hanwha Techwin will build together is a 155mm, 52- calibre gun, mounted on a tracked, armoured vehicle. Artillery units equipped with this highly mobile gun will be a part of the Indian Army’s strike corps, whose tank spearheads need artillery guns that can keep pace with them.

Jayant Patil, Chief of L&T’s Defence Business, has recently stated, “L&T plans to begin production of this vital weapon system at its Strategic Systems Complex at Talegaon, near Pune in Maharashtra, and deliver the first batch of 10 guns. L&T also has initiated setting up of a greenfield manufacturing line at Hazira, Gujarat, integral with a state-of-the-art test track, to produce, test and qualify the K9 Vajra-T guns.“ L&T has also committed that it would not just build the Vajra-T guns in India, with over 50 per cent indigenous content, but also provide the Army through life support.