The Australian Government is planning to spend nearly A$20bn ($18.7bn) to procure ten Japanese-built Soryu-class submarines, in a bid to upgrade its naval fleet and replace the aging Collins-class vessels from 2030 onwards.
Anticipated to be signed by the end of this year, the deal comes amid rising maintenance costs of the Collins-class boats beyond 2026.
The move is contrary to the government's promise to support the country's ship builders with the construction of new fleet at home.
Australia Prime Minister Tony Abbott was quoted as saying: "The most important thing is to get the best and most capable submarines at a reasonable price to the Australian taxpayer.
"We should make decisions based on defence requirements, not on the basis of industry policy."
Powered by an air-independent diesel-electric propulsion system, the 4,200t Soryu-class vessels can remain submerged longer than other traditionally powered submarines.
Expected to be based out of Darwin in northern Australia to trim down transit distances to patrol areas, the Soryu submarines can accommodate a crew of 65 and offer a shorter range compared to Collins-class vessels.
Japan's Maritime Self-Defense Force has been using the Soryu-class submarine since 2009, which is an advanced version of the Oyashio-class submarine.
Meanwhile, Australia is said to still be considering French and German alternatives, reported news.com.au.