India will pay about $2 billion to lease a nuclear powered submarine from Russia, people familiar with the matter told Bloomberg News.
The delivery of the vessel was finalised after nearly a decade of negotiations during President Vladimir Putin's visit to New Delhi this week.
Talks for leasing the attack submarine had stalled over the years because of price negotiations, the people said, requesting anonymity as discussions were private.
The deal is now agreed, with Indian officials visiting a Russian shipyard in November, reported NDTV.
India expects to take delivery of the vessel within two years, although the complexity of the project could push the timeline further, they said.
Putin is set to arrive in India on Thursday for his first visit since Russia’s invasion of Ukraine. He will meet Prime Minister Narendra Modi to underscore defence and energy ties between the two nations.
Modi has moved to strengthen relations with Russia and China in recent months, asserting India’s strategic autonomy after US President Donald Trump imposed punitive tariff rates of 50 per cent on Indian goods.
New Delhi is negotiating a trade deal to reduce those duties, which were implemented as part of Trump’s pressure on India to stop purchasing Russian oil as he seeks leverage on Putin to end the war in Ukraine.
Ahead of Putin’s visit, Chief of Naval Staff Dinesh K. Tripathi said the commissioning of the attack submarine would be expected soon, without offering details.
The vessel will be larger than the two already in the navy’s fleet.
India’s external affairs ministry and defence ministry did not respond to Bloomberg’s emails seeking information. Russia’s foreign ministry, defence ministry and Rosoboronexport also did not respond to requests for comment.
India has developed nuclear capable submarine-launched ballistic missiles that give it a triad of atomic weapons deliverable by land, sea and air, according to the Nuclear Threat Initiative (NTI).
Nuclear powered submarines are typically larger than diesel electric variants, can stay submerged far longer and are quieter, making them harder to track during patrols in the Indian and Pacific oceans.
India operates 17 diesel powered submarines, the NTI said.
India’s nuclear powered submarines used for strategic deterrence are indigenously built and designed to carry Submarine-Launched Ballistic Missiles (SLBMs)
The country is preparing to build nuclear powered attack submarines intended to hunt and destroy enemy submarines and surface ships.
Under the lease terms, the Russian attack submarine cannot be used in war, the people said. It will be used to train sailors and refine nuclear boat operations as India develops its own vessels.
The submarine will be leased for 10 years. The last Russian boat, also leased for a decade, was returned in 2021. The contract will include maintenance, they said.
Interest in such vessels has grown as the Indian Ocean region draws greater global attention. Australia is working with the United Kingdom and the United States to build similar submarines under the AUKUS security partnership.
Only a handful of nations including the United States, United Kingdom, France, China and Russia possess the technology to deploy and operate nuclear powered submarines.
South Korea is also working with the United States to build nuclear powered submarines.
India continues to maintain longstanding ties with Moscow while building deeper links with Washington. It has reduced reliance on Russian weapons by acquiring more arms from the United States and European suppliers.
Modi’s decision to rely on Russia for nuclear submarines indicates New Delhi’s comfort with Moscow on critical defence platforms despite criticism from Trump.
Trump said in a Truth Social post in July that India had purchased the vast majority of its military equipment from Russia and remained Russia’s largest buyer of energy along with China.
The United States has pressured India to halt Russian oil imports and introduced a 25 per cent secondary tariff on US imports of Indian goods from late August.
India’s third ballistic missile submarine is expected to join its nuclear forces next year, according to Tripathi. India is also building two nuclear powered attack submarines, Bloomberg News reported.