Senator Urges Japan to Use Australian Components in Subs

An influential Australian senator has asked Japan to buy components for its Soryu submarines from Australian companies to boost its chances of winning a major contract to supply Canberra with a fleet of submarines.

Independent South Australian Senator Nick Xenophon made the request to submarine builders Kawasaki Heavy Industries Ltd and Mitsubishi Heavy Industries Ltd as well as government officials in a series of meetings in Japan this week.

"What could be a game changer in their bid and in the relationship between the two countries in terms of defense cooperation is for components to be built in Australia," Xenophon said during an interview in Tokyo on Thursday.

Adding foreign companies into the supply chain for a purely domestic defense project, particularly one as secretive as a submarine, would be an unprecedented move for Japan and one that would be politically sensitive too because it would mean having to take work away from Japanese firms.

By choosing a variant of Japan's 4,000 ton Soryu submarine, Australia would give Japan its first major overseas deals after Prime Minister Shinzo Abe lifted a ban on arms exports last year.

The Australian government is weighing the Japanese bid against competing proposals from ThyssenKrupp Marine Systems, a subsidiary of Germany's ThyssenKrupp AG, and France's state-controlled naval contractor DCNS Group.

Without an attractive industrial package, that includes offering to build at least 70 percent of Australia's submarines in South Australia, Xenophon said Japanese companies and officials risked becoming embroiled in a political backlash that would threaten Prime Minister Tony Abbott's government.

"If the Australian government makes a decision to build the submarine overseas the winning country will find itself in the middle of a huge political brawl in Australia," Xenophon said.

The South Australian senator said he planned to put the submarine project front and center in a campaign to win seats from Abbott's ruling conservative Liberal Party in the next election for the 150-seat lower house, which must be held by January 2017.

Xenophon said he would field candidates to run against ruling party lawmakers and aimed to take at least four of the six Liberal Party seats in his state.