Seven years after it first initiated it, the defence ministry has withdrawn a Request for Proposal (RFP) for the Rs 20,000 crore Landing Dock Platform project, which is being seen as a setback to private domestic shipyards that were interested in it.
These Landing Dock Platforms (LPDs), also known as amphibious transport docks by some navies, are meant to weigh around 30,000 tonnes, and be able to carry an Army battalion, tanks and armoured carriers into a war zone, along with helicopters.
Sources in the defence and security establishment said the Navy will now decide new qualitative requirements for the amphibious warships, because too much time has elapsed since the RFP was put out.
However, a different set of sources say that more than the ‘time gap’, the real issue was the emergence of a single-vendor situation, with an internal capability assessment going against one of the two shipyards in contention.
The retraction took place on 25 September, sources said, adding that the RFP has been withdrawn after nine extensions and one re-submission of bids in seven years.
It is hoped that the new RFP for the warships will allow much wider participation and could also involve public shipyards. The entire process will take time, the sources admitted.
The RFP process
In November 2013, the Navy had invited proposals from private shipyards to build four LPDs at an approximate cost of Rs 20,000 crore.
In July 2014, three shipyards — ABG Shipyard, L&T Shipbuilding and Reliance Naval (then called Pipavav Defence and Offshore Engineering Company Ltd) — submitted bids. They were the only technically qualified shipyards for the project.
Between 2014 and 2017, the defence ministry extended the bid four times, before disqualifying ABG due to financial stress and loan defaults. It then directed L&T Shipbuilding and Reliance Naval for resubmission of the commercial bid.
Then, between 2017 and 2020, the ministry asked both to extend their commercial bid five times.
The plan was for the Indian shipyards to tie up with foreign firms to build the LPDs in India.
French defence giant DCNS, which is already building Scorpene submarines in India through its domestic partner Mazagaon Dock Ltd (MDL) in Mumbai, was also eyeing the project. DCNS had tied up with Pipavav (now Reliance Naval) and was supposed to provide technical and design assistance.
L&T, meanwhile, had tied up with Spain’s Navantia, and was considered the front-runner for the LPD project.
Last month, a Comptroller and Auditor General (CAG) report noted that the Indian Navy does not have adequate auxiliary vessels, LPDs, fleet tankers and cadet training ships.
The CAG noted that the existing capability of the LPD was found to be inadequate to meet requirements of amphibious and expeditionary operations.
“This was due to failure to fix a specified time frame for obtaining a corporate debt restructuring exit certificate by one of the participating firms,” the report stated.