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Russia’s United Shipbuilding Corporation To Likely Purchase India’s Largest Shipyard

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Russia's United Shipbuilding Corporation To Likely Purchase India's Largest Shipyard

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Russia’s state-owned United Shipbuilding Corporation (USC) has expressed interest for the purchase of India’s Pipavav shipyard, Indian media reported.

The shipyard is currently owned by Reliance Naval and Engineering Ltd (RNAVAL), which went bankrupt extended the the date for submitting expressions of interest (EoI) to revive India’s biggest integrated shipbuilding facility by capacity, to July 27th.

The initial deadline was June 27th, but there were only five offers, and it was allegedly due to the COVID-19 lockdown.

RNAVAL has a permit to build warships from the Indian government and is being sold under the Insolvency and Bankruptcy Code (IBC) to recover unpaid dues of 435 million rupees ($5.8 million).

The total debt of RNAVAL in 2019 sat at 126 billion rupees ($1.6 billion).

Russia’s state-owned United Shipbuilding Corporation (USC) is the only serious contender from the list of five that submitted the initial bids for the yard.

The shipyard is the only one in India that has ever worked on US Navy warships, namely the repair, service and maintenance of its Seventh Fleet operating in the Indian Ocean region.

USC has a long-standing interest and connection with the RNEL shipyard, which has long been cooperating with Russian enterprises.

In the 2000s, this Indian shipyard, then called Pipavav Defense and Offshore Engineering (PDOE), collaborated with the Russian Northern PKB OJSC in developing a project for 21 patrol ships, a series of which was ordered by the Indian Navy. The Russian version of the project was later rejected.

In December 2010, PDOE entered into a cooperation agreement with the Federal State Unitary Enterprise Rosoboronexport to jointly promote Russian warships to Indian and third-country markets. The collaboration also included the maintenance of a number of Indian Navy ships – Project 877EKM submarines and three Indian Project 17 frigates (of the Shivalik type), also developed with the participation of the Northern Design Bureau.

In July 2015, PDOE signed an agreement with the Russian shipyard repair center Zvyozdochka, n joint venture to implement the planned program for the regular repair and modernization of four diesel-electric submarines of Project 877ECM of the Indian Navy, aimed at the formation of a repair center for Russian-produced submarines operated by third countries.

Based on this joint venture of projects of the 877 and 636 series of fleets of third countries.In 2015-2016, USC also planned to choose RNAVAL/PDOE as the construction partner in India for two frigates of project 11356 for the Indian fleet – but the Indian side chose the state shipyard Goa Shipyard Limited in Goa.

Currently, RNAVAL is the largest shipbuilding company in India, having a huge dry construction dock with a length of 662 m and a width of 65 m, capable of accommodating ships of any size (in fact, 295 m of the length of the dock is reserved for ship repair).

The dock is equipped with two 600-ton large Goliath cranes with a lifting capacity of 1200 tons.

There is also a site for the construction of offshore oil and gas production platforms with dimensions of 750 by 265 m, an extension berth of 300 m and extension embankments with a length of 720 m. It is alleged that the shipyard’s capacity can handle up to 12 thousand tons of steel per day.

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