Japan plans to develop and produce a "next generation" non-nuclear submarine that is quieter, more resistant to attack and has more advanced sonar capabilities.
The estimated 5.1 billion yen ($42.9 million), ten-year project is to begin in April 2007, a Defence Agency official said on condition of anonymity, citing protocol.
He said the agency has made a budget request of 400 million yen ($3.36 million) for the initial year, pending parliamentary approval.
The project primarily aims to cut the noise from a submarine's propeller to minimise the risk of it being detected, while increasing the vessel's shock resistance in case of enemy attacks.
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