Expansion in the government-run shipyards’ capacities would ensure that the Navy’s needs are met over the next five years, and therefore they should now start focusing on exports, Defence Minister Manohar Parrikar said on Saturday.

"Now that the capacity is built up, the needs of the Navy will be coming under control in next four to five years. They should start looking at exports now," Parrikar told reporters after inaugurating a Rs 150-crore submarine building facility at Mazgaon Docks & Shipbuilders (MDL) here.

Stating that there is sufficient capacity at the shipyards, Parrikar said the state-run shipyards including MDL, Cochin Shipyard and Garden Reach Shipyard in Kolkata should set up an export cell.

Production revenues of the defence public sector undertakings have grown by 20 per cent to Rs 51,600 crore in FY2016 from Rs 43,000 crore in FY2014, he said.

The shipyards have been exporting to markets like Sri Lanka, the Maldives and Mauritius of late, and should step up these efforts, he said.

"We have not done much of exports. Last year, a few ships were exported. I would request the chairman of MDL that he immediately, alongwith other shipyards, set up a special cell to sell our indigenous ships and export," the minister said, adding the cell can be small initially and need not focus on complex projects like submarines to start with.

When asked if the country’s diplomatic ties and engagements will drive the exports, he said, "Whatever support is required for the industry for export will be extended by the Defence Ministry, including our personnel placed abroad who can liaison for them."

The pitch for exports assumes significance as it comes amid an increased interest by the private sector in the defence arena.

Parrikar also expressed displeasure over the level of indigenisation in the Rs 25,000-crore Scorpene project, saying at the end of the first batch of six submarines, the ratio is only 30-35 per cent.

Conceding that the desired level of indigenisation is not explicitly stated in the contract with the French company DCNS for building the Scorpenes, signed in 2007, the minister asked MDL to increase the level of indigenisation to at least 45 per cent in the future projects.

He said the first of the Scorpene submarines being built at the MDL is undergoing sea trials at present and will be inducted in the Navy in the fourth quarter of 2016.