Germany and Spain, the two European defence manufacturing giants, are looking to win the Rs 40,000 crore ($4.8 billion) order to build submarines in India to strengthen the country’s naval strength to counter China’s maritime presence in the Indo-pacific region.

Currently, Indian naval forces need a minimum of 24 conventional submarines but have just 16, of which most are over 30 years old and are likely to be decommissioned within the next few years.

In recent years Beijing has grown its naval capacity, and India’s ageing fleet is no longer seen as enough to discourage China’s presence in the Indian Ocean.

The officials in the government are currently evaluating the bids to build six of the vessels in the country.

Currently, the confirmed bidders list includes Germany’s Thyssenkrupp AG along with Mumbai-based Mazagon Dock Shipbuilders Limited and Spain’s Navantia in partnership with private shipyard Larsen & Toubro.

Last July, India’s Ministry of Defence issued a tender inviting global defence manufacturers to design, develop, and manufacture conventional diesel-electric-powered submarines with either government-owned Larsen and Toubro or Mazagon Dock Shipyard Ltd.

When the tender was announced, the Ministry of Defence was expecting a substantial technological transfer to Indian shipyards and providing the submarines with air-independent propulsion that helps conventional vessels stay underwater longer.