Reliance Defence speeds up Rs 2,500-crore patrol vessel project

14 June 2016

Reliance Defence is accelerating work on an inherited order for naval offshore patrol vessels (NOPVs) and has assured the Indian Navy of supplying all the five craft by the end of 2017, bringing clarity to the largest warship building project awarded to the private sector.

The Rs 2,500-crore NOPV project was awarded by the Navy in 2011 but ran aground after Pipavav DefenceBSE 2.77 % and Offshore Engineering went under debt and broke off with a Russian design partner for the small combatant vessels. The first of the NOPVs were to be delivered in early 2015 but work almost stopped in 2014 as the yard faced financial and technical constraints.

Now acquired by Reliance Defence - the first major purchase by the Anil Ambani group - the yard is being spruced up and work has accelerated on the NOPVs. A senior Indian Navy team that visited the yard last month was assured that the first of the new vessels - with a displacement of 2000 tons - would be delivered next year.

Assurances have also been given that the delivery period for the vessels will be crunched and all five would be ready for induction by the end of 2017. "The new management is working on an aggressive delivery schedule, revamping the work breakdown structure for the second batch of three NOPVs. The period between keel-laying to delivery for the second batch of the NOPVs will be cut down to half," said Admiral HS Malhi (retd), CEO of the shipyard.

Work accelerated early this year with construction being carried out in two batches of two and three vessels. The plan is to construct the last three vessels within an 18-month period, against the 36-month norm for vessels of this size. Reliance executives said more than 2000 workers are working on a threeshift schedule to meet the new deadlines for delivery.

"Over the past 12 months, we have been working on strategic partnership agreements with a number of leading global OEMs across a wide spectrum of military equipment and hardware and are today well-poised for a major role in delivering on the government's Make in India procurement programs," Anil Ambani said.

The NOPV is designed for offshore patrolling, surveillance, escort and fleet support duties and is the largest combat vessel being constructed at a private yard. All major orders in the past - for frigates and destroyers - have gone to government-owned yards like GRSE, MDL and CSL.

While the NOPV order was initially bagged in 2011, the yard was acquired by Reliance Infrastructure in March 2015 after it went into heavy debt. Reliance Infra now owns almost 35 percent of the company and has assumed control. Pipavav Defence has also been renamed as Reliance Defence and Engineering Ltd. (RDEL).


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