Under the MoU, conceived under the umbrella of the special strategic partnership, the two sides will nominate one shipyard each for this purpose.
India has already picked Hindustan Shipyard Limited (HSL) while Korea will make the nomination soon, Secretary (Defence Production) Ashok Kumar Gupta said.
Gupta and Korea's Minister of Defence Acquisition and Programme Administration Chang Myong Jin signed the agreement here.
"It will enable HSL to upgrade and modernise its facilities so as to enable it to execute naval projects in a timely manner," Gupta said, adding the whole initiative was part of the Centre's 'Make in India' initiative.
Jin said the agreement will form the basis of defence cooperation between the two countries in shipbuilding.
Gupta also said that the agreement will be useful for the development of vendors for supply of material.
"That will generate huge employment and will also increase the turnover of HSL," he said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)