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Turnbull launches $50 billion subs deal

AAP logoAAP 16/12/2016 Max Blenkin, Defence Correspondent

Standing before Adelaide's shipbuilding precinct, Prime Minister Malcolm Turnbull announced Australian's 12 new submarines would be based on a French design, the culmination of a comprehensive but contentious evaluation process.

The momentous announcement launched Australia's largest-ever defence project, a $50 billion navy procurement deal set run to well past mid-century.

It will form a central plank of a national industry policy, designed to replace the defunct car industry and diminishing resources development sector with high-tech manufacturing based on Australia's future submarines and warships .

As well as the submarines, there will be nine new frigates and a dozen offshore patrol vessels, all constructed in Australia.

Depending on how it all unfolds, the decisions of the coalition government in 2015 and 2016 will be lauded as courageous and visionary or damned as a disaster that subjugated long-term defence procurement to short-term politics.

French firm DCNS was named the winner in April, with a formal contract signed in September giving the go-ahead for design of Australia's new sub.

DCNS will work with Lockheed-Martin Australia which will undertake combat system integration.

The design process will take a number of years and the actual cutting of steel won't start until around 2022-23. The first sub won't enter service until after 2030.

However, the first visible manifestations of this vast investment will start to appear next year with construction of a submarine assembly shed, which Defence Industry Minister Christopher Pyne says will be larger than the Adelaide Oval.

DCNS was selected at the end of an evaluation process which pitted the French firm against TKMS of Germany with its Type 216 and the government of Japan, with Mitsubishi Heavy Industries and Kawasaki Shipbuilding Corporation, with their Soryu-class boat.

The evaluation process emerged from a backlash of South Australian Liberal MPs when it appeared then PM Tony Abbott had done a deal to acquire new subs direct from Japan with limited Australian industry involvement.

Neither Abbott or anyone else has ever said that indeed was the plan.

DCNS emerged late as a serious contender. Just why it was chosen hasn't been disclosed but there's a variety of factors supporting the decision.

It has a new sub, the nuclear Barracuda-class close to the size we desire and was willing to fully transfer the advanced technology needed to create a sovereign design capability.

Already the process has started, with Australians heading to Cherbourg to learn how DCNS builds submarines. Australia and France have signed a security agreement, with Turnbull set to sign ane inter-governmental agreement with visiting French Defence Minister Jean-Yves Le Drian on Monday.

With submarines hogging the headlines, Australia's contribution to the US-led coalition fighting Islamic State in the Middle East attracted less attention, though it remains significant.

Flying from bases in the Persian Gulf, RAAF F/A-18 Hornets, a KC-30A tanker aircraft and a E-7A Wedgetail airborne early warning and control aircraft have participated in raids on IS forces in Iraq and Syria, dropping more than 1500 bombs during the past two years.

The conflict inside Iraq is approaching the end game, with Iraqi forces supported by coalition air power well advanced in the fight to retake the city of Mosul. Once Mosul falls, the main fight will then move to Syria and the IS capital Raqqa.

That means Operation Okra - Australia's contribution to the international coalition fighting IS - will be mostly over.

The joint Australian and New Zealand training team based at Taji, north of Baghdad, has trained a large number of Iraqi soldiers for the bruising Mosul battle and has recently taken on a new mission to instruct Iraqi police in skills needed to hold onto territory retaken from IS.

That won't continue indefinitely. Iraq's government insisted from the outset that it alone should fight IS in the ground battle and while it appreciated western assistance, it would be happier when they all went home.

For Australia, that will certainly occur in 2017, though Australia will retain use of its base in the United Arab Emirates to support the ongoing deployment to Afghanistan .

With end of year comes the usual speculation about a ministerial reshuffle, with Defence Minister Marise Payne nominated as one of those ministers in the firing line.

Although ranked as equal with Defence Industry Minister Christopher Pyne, she's been mostly overshadowed by the energetic and media-savvy South Australian.

As well, she was absent from parliament in December recovering from surgery for an abdominal infection, missing ministerial talks with Japan because she was unable to fly.

For his part Pyne has emphatically denied coveting Payne's job.

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