The development assumes significance since the deal is part of Australia’s plan to secure its trade interests in the strategic Asia-Pacific region.
On Monday, Australia signed a production contract with French shipbuilder Naval Group for a fleet of twelve new submarines worth $35.5 billion (A$50 billion).
Australia selected France’s Naval Group from other bidders for its fleet of submarines ahead of other offers from Germany and Japan.
Australia and Naval Group signed a Strategic Partnering Agreement, the overall contract to guide the construction.
“This means we are ensuring we are at the front of the pack when it comes to the latest naval vessels and firepower,” said Australian Prime Minister Scott Morrison.
Australia’s submarines fleets are at the heart of its plan to significantly expand its military to protect its strategic trade interests in the Asia-Pacific region.
Australia rejected offers from Japan’s Mitsubishi Heavy Industries and Kawasaki Heavy Industries, as well as Germany’s ThyssenKrupp AG, when it accepted the French bid.