Germany and India Near $8 Billion Submarine Deal to Boost Naval Power

Germany and India are on the brink of sealing a major defense agreement worth at least $8 billion for advanced submarines, Bloomberg News reported, marking one of the largest defense contracts between the two strategic partners and a significant milestone for India’s naval modernization efforts.

Under the deal, Germany is expected to supply conventionally powered attack submarines—likely variants of its highly capable designs—to the Indian Navy under India’s Project-75(I) submarine acquisition initiative, which aims to boost maritime deterrence in the Indo-Pacific.

Germany and India are hammering out the details of a submarine manufacturing deal worth at least $8 billion — the largest-ever defense agreement for New Delhi https://t.co/qOLmsR4ohc

— Bloomberg (@business) January 8, 2026

Background: Project-75(I) and Strategic Shift

Project-75(I) is a long-running Indian defense program to replace aging submarines and expand underwater capabilities, originally conceived in the 1990s to procure six diesel-electric attack submarines with advanced features like air-independent propulsion (AIP).
Germany’s TKMS (ThyssenKrupp Marine Systems) has been a frontrunner in negotiations, having previously signed a memorandum of understanding with India’s Mazagon Dock Shipbuilders as early as 2023 to jointly pursue submarine construction.

The prospective $8 billion agreement surpasses earlier estimates—such as a $5.2 billion proposal discussed in 2023—reflecting enhanced technology transfer, localized production and broader capabilities tailored to India’s evolving defense needs.

Strategic and Geopolitical Importance

Defense analysts say the deal strengthens India’s naval deterrence against regional challenges, particularly amid rising Chinese maritime activity in the Indian Ocean Region (IOR). The submarines will bolster India’s ability to conduct anti-submarine warfare (ASW), intelligence gathering, and power projection beyond its shores.

For Germany, the agreement represents a major expansion of its defense exports to Asia, reinforcing Indo-German strategic ties beyond economic cooperation into key security domains.

Production, Technology and Delivery Outlook

Beyond acquisition, the deal is expected to include provisions for technology sharing, joint manufacturing and long-term support, with Indian shipyards playing a central role in production. This aligns with New Delhi’s “Make in India” initiative aimed at building domestic defense industry capabilities.

Negotiations reportedly are being finalized and could culminate in formal contract signing during high-level diplomatic engagements this year, with delivery schedules initially projected over several subsequent years following construction and testing.

Regional and Global Implications

The potential submarine deal signals a deepening of India’s defense partnerships with Western allies, diversifying away from traditional suppliers while acquiring advanced maritime capabilities suited for contemporary security environments.

For New Delhi, strengthening its submarine fleet is not only a tactical imperative but also a strategic message of self-reliance and regional security leadership. For Berlin, the agreement underscores its intent to play a more influential role in Indo-Pacific security frameworks.