Chile is going ahead with plans to build its own submarine and patrol boats as part of a program to develop the Latin American nation's defense manufacturing industry.

Brazil's international success with aviation and defense industrial development has inspired its neighbors to develop their own defense industries, both as a source of export revenue and as a response to growing domestic demand for modernization from the armed forces.

Shifting political alliances and economic problems led to several regional countries being denied equipment from U.S. defense suppliers, a major source in the past. Trade recovery has given Latin American nations much needed cash resources but found them ill-prepared for the 21st century, after decades of neglect.

Chile's plan to build a Crocodile Class 250 submarine will be the first venture of its kind for the country's metallurgical and steel industries.

Senior officials said the planned submarine will be used mainly for research and be on standby for rescue operations. It wasn't immediately clear from manufacturer Vapor Indus trial's announcement if the government would fund the submarine development or award a procurement contract.

The submarine project is likely to involve several overseas suppliers of electronic and other equipment not available from Chilean firms.

Meanwhile, plans are well advanced on developing the country's industrial capacity to build rather than import patrol craft. The Chilean navy-owned Asmar shipyard is building a third offshore patrol vessel to join a fleet that includes two ships built and delivered earlier.

Asmar sources said the new naval craft was being developed to withstand extreme weather conditions in the Arctic waters. Weaponry on board the ships is also being upgraded, the shipbuilder said.

The patrol vessels are generally based on the German Fassmer OPV 80 design. The 1,900-ton ships have a maximum speed of 20 knots, maximum endurance of 30 days and a crew of up to 60, officials said.

As with the two craft delivered earlier, the new vessel will be equipped with a 40-millimeter gun and several .50-caliber machine guns.

Analysts said the patrol boat building program had given Chile confidence to undertake more complex defense manufacturing projects.

Chilean Defense Minister Andres Allamand recently attended a presentation on the key features of the Crocodile Class 250 submarine, developed over eight years. Current cost estimates of $10 million for a single submersible are subject to revision as the government and manufacturers review features to be added to the first vessels.

Allamand explained Chile plans to develop the submarine mainly as a vessel fit for research and rescue and not as an offensive weapon.

"In the event of accidents that other submarines might have, or in the event of emergency situations that might be related, for example, to an environmental disaster, there are no submarines in this part of the world that have the high level of rescue capabilities that this project has."

He said the planned submarine "could render enormous service" in all areas related to scientific and environmental research as well as rescue operations when required.