Larsen & Toubro (L&T), a multinational conglomerate, has suffered a significant setback after the Ministry of Defence rejected its bid to build six submarines for the Indian Navy. The rejection comes after L&T’s CEO, SN Subrahmanyan, sparked controversy by encouraging employees to work even on Sundays, sparking backlash and criticism. The company had partnered with Spanish state-owned shipbuilding company Navantia to submit a proposal for the Project 75 India, which aimed to build and deliver six advanced submarines to the Indian Navy.
However, the tender was rejected due to L&T’s non-compliance with the Indian Navy’s requirement for a sea-proven system, as stated in the tender specifications. L&T and Navantia had demonstrated their Air Independent Propulsion (AIP) system to the Indian Navy in Spain, but this was a shore-based demonstration, whereas the Indian Navy required a system that had already been proven at sea.
As a result, L&T has lost a massive Rs 70,000 crore, and the state-owned Mazagaon Dock Shipbuilders Limited (MDL) and its partner, Germany’s ThyssenKrupp Marine Systems, are now the only remaining contenders for the contract. This development is a significant blow to L&T, which had been eyeing the contract to build the six submarines. The company’s controversial CEO comment had already sparked criticism, and this latest setback is likely to further dent its reputation.