Germany and India are set to sign a record-breaking $8 billion defense deal

Germany and India plan to sign a major agreement over the next three months for the construction of six submarines with a total value of at least $8 billion. The project involves setting up submarine production facilities directly in India, which will mark the largest defense contract in the country’s history. 

Bloomberg reports on the preparation of the document and the coordination of the final steps by the government in New Delhi, citing a statement by German Defense Minister Boris Pistorius.

This agreement is unique because, for the first time in history, it involves the transfer of German submarine-building technology to a country that is not among Germany’s European allies. The Indian side is currently finalizing internal procedures for the official signing of the contract. The implementation of the project will allow India to significantly strengthen its defense capabilities and modernize its submarine fleet. Cooperation between Berlin and New Delhi in this area demonstrates a new level of strategic partnership and trust between the countries. 

Previously, the German side had been cautious about such technology exports outside Europe. Furthermore, the shift toward German designs could be a step toward diversifying sources of arms supply, which were previously largely provided by Russia. Final approval of all technical and legal details of this historic agreement is expected within the next quarter. 

India has approved $25 billion in military procurement to strengthen its armed forces following the conflict with Pakistan. The list includes aircraft, drones, missiles, and surveillance systems. The country is actively modernizing its military and increasing defense spending.

The Indian Armed Forces have purchased dozens of “Berkut-BM” single-use drones developed by the Belarusian company Indela.