Russians won't budge on Gorshkov price

Thu, Feb 28 01:10 AM

The Russians are embarassed about the delay in readying aircraft carrier Admiral Gorshkov for Indian Navy, but have taken a no-budge stand in demanding an additional $1.2 billion to refurbish the 21-year-old warship. The aircraft carrier deal now carries a price tag of over $2.7 billion, but New Delhi appears to have reconciled to the substantial price hike that had even attracted Navy chief Admiral Sureesh Mehta's ire.

Defence secretary Vijay Singh, who was in Russia last week to discuss issues pertaining to Gorshkov, said on Wednesday, "There will be a substantial increase in its reworked price. They wanted a reaffirmation that India wants the warship.

" The defence ministry says market evaluations show that a Gorshkov-like carrier - minus embarked fighters - could cost upwards of $4 billion. India had contracted the Gorshkov deal for $1.5-billion in January 2004.

Aside from the refit of the 45,000 tonne carrier, the package included 16 MiG-29K fighters, six Kamov helicopters, training for pilots, simulators and spare parts. The defence secretary said the carrier would be ready by 2010, after which it would undergo 18 months of extensive sea trials.

The delivery schedule of Gorshkov, to be called INS Vikramaditaya in Indian service, has been pushed back to 2012, although the warship was originally supposed to join the Indian fleet by August 2008. Victor Khristenko, Russia's minister for industry and energy, told the defence secretary that the Russians were embarrassed about the delay.

Khristenko said cost escalation was inescapable. However, the ministry is making last-ditch efforts to achieve some kind of a breakthrough in getting the price lowered.

It has constituted a team under Vice Admiral Dilip Deshpande, controller, warship production and acquisition, to examine the "reasonableness of Gorshkov's cost" before the modified contract is put up before the Cabinet Committee on Security sometime in March. Moscow has demanded an extra $ 1.2 billion to carry out complex cabling work, replacing boilers and turbines and strengthen its flight deck for embarked fighters, as part of complete retrofitting of the carrier.

RECOMMEND THIS STORY