The federal government will spend $1.7 billion over the next five years to acquire a fleet of Australian -made and designed underwater drones.

The "ghost shark" will enter service for the Royal Australian Navy at the start of next year after the Department of Defence signed a contract with manufacturer Anduril Australia to deliver, maintain and continue developing the unmanned submarines over the next half-decade.

Deputy Prime Minister and Defence Minister Richard Marles announced the deal this morning, saying the new fleet will deliver Australia "world-leading", long-range stealth capabilities.

"There is a lot of advancement in technology about making submarines harder to detect," he said.

"We are really confident about the program that we are on in terms of giving Austral

See Full Page