$8 Billion Deal: India And Germany Set To Seal Biggest-Ever Defence Agreement | World News
New Delhi: India and Germany are moving towards what could be the biggest defense deal New Delhi has ever signed. The two countries are preparing to sign a submarine agreement worth approximately $8 billion. The agreement is expected to be signed before German Chancellor Friedrich Merz’s visit to India.
Officials familiar with the discussions say the talks are focused on building advanced submarines. This will be a key moment in India’s naval modernization plans. If completed, this will surpass all previous defense contracts signed by New Delhi.
India currently operates submarines procured from Russia and France, making the scale and direction of this proposed partnership with Germany a major strategic shift.
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Technology transfer
According to Bloomberg, India-Germany talks are focusing on an $8 billion defense deal that goes beyond procurement. Sources say the deal involves the transfer of submarine construction technology to India, a first of this scale.
Work is ongoing to finalize the framework as Chancellor Merz prepares for his visit to India next week.
This technology sharing component is seen as an important element aligned with India’s effort to strengthen domestic defense production and reduce long-term dependence on foreign-made platforms.
Make in India
Currently, the Indian Navy operates around a dozen Russian-origin submarines and has commissioned six new ships built in France. The report states that if the agreement with Germany is realized, India may re-evaluate its plan to purchase three additional submarines from France.
Under the proposed arrangement, the submarines will be built in India by combining Berlin design with New Delhi’s shipbuilding capacity in partnership with Germany’s ThyssenKrupp Marine Systems GmbH and India’s Mazagon Dock Shipbuilders Limited.
Merz’s Visit to India
Chancellor Merz will visit India for the first time on Monday, January 12, 2026. His trip begins in Ahmedabad, Gujarat, where he is scheduled to meet Prime Minister Narendra Modi. From there he will go to Bengaluru.
The visit is expected to deepen cooperation between the two countries across sectors, including defense and pharmaceuticals. The discussions are also expected to include efforts to accelerate negotiations on a free trade agreement between India and the European Union.
Designed to Stay Underwater for Longer Time
The new submarines under discussion will be equipped with Air Independent Propulsion (AIP) systems, a technology that increases underwater endurance. Compared to traditional diesel-electric submarines, AIP-equipped ships can stay submerged for much longer periods of time, increasing stealth and operational reach.
ThyssenKrupp Marine Systems declined to comment on the report. The Ministry of Defense and the Ministry of Foreign Affairs also did not make any statements regarding the proposed agreement.
The agreement, if concluded, will signal a new page in India-Germany strategic relations and change the future of India’s underwater warfare capabilities.
