France and Australia on Friday reaffirmed their "full commitment" to ensuring local firms play a role in building Australia's next generation submarines, after the main French contractor suggested Australian industry was not up to the job.

French Defence Minister Florence Parly met counterpart Linda Reynolds on the sidelines of the Munich Security Conference after the comments by French shipbuilder Naval Group sparked outrage.

"Both of us reaffirmed our full commitment to the programme, in particular with respect to the schedule and Australian industry capability," they said in a joint statement.

"We are committed to work together to make it a success," they said, adding that the massive project worth tens of billions of euros (dollars) was key to the countries' strategic ties.

The Naval Group consortium, partly owned by the French state, was chosen in 2016 to design and build 12 attack-class submarines for the Australian navy.

The deal is Australia's largest ever defence procurement project and is expected to create some 2,800 jobs in the country, alongside some 500 in France.

The first submarine is slated for delivery in 2032.

But Naval Group Australia chief executive John Davis raised doubts about the project after saying in a recent interview that Australian involvement could be lower than anticipated.

He told The Australian newspaper that the subs had "unique requirements" and there was "a lot more work to be done than we anticipated" in finding the necessary local expertise.

Reynolds said she was "disappointed" by the comments.

The Naval Group has since moved to play down the controversy, saying it had already brought 137 Australian subcontractors on board.

"Everything is being done to ensure that the Australian industry is totally involved," it said on Friday.

Australia hopes the new submarine fleet will serve as a credible deterrence in the region.

It comes amid growing alarm over increased Chinese assertiveness, particularly in the disputed South China Sea, where Beijing is building up its military presence.

vl-mrb/mfp/bmm

NAVAL GROUP

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