Post by : Shakul

Malaysia has announced that it is seeking RM1.06 billion (€226.13 million) in compensation from Norwegian defence company Kongsberg Defence & Aerospace (KDA) following the cancellation of the Naval Strike Missile (NSM) procurement contract for the Royal Malaysian Navy's Littoral Combat Ship (LCS) programme.

Defence Minister Datuk Seri Mohamed Khaled Nordin said the claim includes both direct financial losses and indirect damages caused by the failure to deliver the missile system as agreed.

What Is Malaysia Claiming?

According to the Defence Ministry, Malaysia's compensation claim consists of €129.86 million in direct losses, covering payments already made under the contract, and €96.26 million in indirect losses linked to additional expenses and other financial consequences resulting from the cancelled procurement.

The government said the total financial impact could change depending on the final settlement process and the replacement missile system currently being evaluated.

KD Maharaja Lela Sea Trials Show Positive Progress

The Defence Minister also updated Parliament on the progress of KD Maharaja Lela, the first Littoral Combat Ship under construction for the Royal Malaysian Navy.

He confirmed that sea trials conducted on April 29 proceeded according to schedule. The vessel is currently undergoing extensive testing of its navigation systems, propulsion equipment, platform performance and other essential operational systems before final acceptance by the navy.

What Happens Next for the Navy?

Officials explained that the ship will only be officially handed over after successfully completing the Sea Acceptance Trial, correcting all technical issues identified during testing and receiving final approval from the Royal Malaysian Navy.

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Meanwhile, defence authorities continue evaluating alternative missile systems that could replace the cancelled Naval Strike Missile programme.

Government Reviews Future Defence Procurement

The cancellation of the missile contract has prompted renewed attention on defence procurement procedures and project management. Authorities say ongoing evaluations are intended to ensure future military acquisitions provide better value, operational readiness and long-term national security benefits.

The Defence Ministry added that additional costs associated with replacing the missile system will only be confirmed once negotiations and technical assessments are completed.

Malaysia Strengthens Naval Defence Planning

Malaysia continues to modernise its naval capabilities as part of its long-term maritime security strategy. The government says improving defence procurement, strengthening fleet readiness and ensuring transparent project management remain key priorities for protecting national waters and supporting regional security cooperation across Southeast Asia.

The outcome of the compensation claim and the selection of a new missile system are expected to play an important role in the future development of Malaysia's naval defence programme.

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