The world market for conventional diesel-electric submarines is predicted to grow at a compounded rate of 1.8 percent until 2022.
British market research and analysis company Frost and Sullivan said especially in demand will be submarines with air-independent propulsion systems.
"The naval operations environment has changed significantly; operations at sea have moved from the 'blue water' open ocean to the 'brown water' shallow coastal environment," said Frost and Sullivan Aerospace, Defense and Security Industry Analyst Dominik Kimla. "The importance of smaller and quieter conventional submarines, rather than larger, nuclear-powered (ones), has increased significantly."
The Asia-Pacific region and Europe appear to be the prime growth areas for conventional submarines, the company said. The Asia-Pacific market for conventional submarines is predicted to grow 2.1 percent and account for 47.2 percent of the global demand.
Europe, which holds a 22.4 percent market share for the vessels and that is expected to grow at a compound rate of 1.5 percent. Germany, Italy, Turkey and Spain have "prominent" conventional submarine projects.
"Navies are increasingly looking at modern SSK (conventional submarines) due to its multi-role capacities and semi-strategic potential," Kimla said. "Consequently, modern conventional submarines present significant market opportunities for the submarine sector to sell new boats as well as to retrofit standard SSK with AIP plug in section."