The government's planned purchase of submarines would not be put out to tender because that is the common practice where defence contracts are concerned, unlike in other business transactions, said a defence ministry official today.

"When we purchase submarines, it does not go through a tender process like any other normal business transaction," the official told malaysiakini.

According to the official, the companies involved would offer their expertise, "look at Malaysia's requirements and say that they have a certain equipment for sale".

Earlier, Defence Minister Najib Abdul Razak told a press conference that several countries had made offers and the government is in the process of deciding which to accept.

"We have made proper evaluations and the government will decide in due course," he said, adding that "we will announce (the result) once a final decision is made. It is too early for me to make any public disclosure".

Najib was speaking to reporters after delivering a keynote address at the Asia-Pacific Electronic Defence conference and exhibition at the Shangri-la hotel in Kuala Lumpur.

Asked how many countries had offered to sell submarines to Malaysia, the minister replied, "Several countries but I am not going to say how many."

Foreign intruders

Yesterday, foreign news agency AFP reported that South Korea's Daewoo Shipbuilding and Marine Engineering had offered to sell one second-hand and two new submarines to Malaysia.

The report further stated that Malaysia had also received offers from German, French, Dutch and Russian companies.

According to the report, Malaysia was buying submarines in order to "deter potential foreign intruders".

Meanwhile, the navy announced last month that it was planning to acquire four submarines, depending on cost, to guard sea trade routes and maintain regional stability.

On pricing, Najib said it is still to be established as no final contract has been signed yet, but stressed that the purchase would not impinge on the country's economy.

"The entire amount will not be spent under the Eighth Malaysia Plan (8MP) but will be spread out and will run into the Ninth Malaysia plan," said the minister.

"What is important is that the decision to buy submarines will not impinge on the country's economy and government finances," he said.

Defence expenditure

When questioned on the expenditure of the defence forces, Najib said that RM2.5 billion is spent annually on development whereas the operating cost is RM4.7 billion.

According to the minister the expenditure is "reviewed from time to time depending on government finances".

"Our defence spending is quite conservative as compared with other countries. We only spend 2.2 to 2.5 percent of the GDP (gross domestic product), which is quite a reasonable sum," he explained.

"Of course we would like to spend more but we have to be realistic because there are demands from the other sectors on the government," Najib added.

In his speech earlier, Najib said that the nature of war had changed over the past 200 years.

"Who can make war is changing as a result of weapons proliferation and the fact that the tools of war increasingly are market-place commodities. By extension, these affect the where, the when and the how of war," he said.

"The spinoffs are to large to ignore, and the inability to grasp such opportunities can only result in strategic obsolescence for the Malaysian Armed Forces," added the minister.