After bitter wrangling with Russia, India has agreed to pay more for the aircraft carrier Admiral Gorshkov as the two countries finalised a new price for the refitted warship which would now be delivered to the Indian Navy only by 2012.
"New Delhi has agreed to allocate extra funds for the carrier which would be delivered to the Indian Navy in 2012, four years behind schedule," Russian officials said following what they said "successful" negotiations to break the prolonged deadlock between the two sides over multi-billion dollar cost escalation.
Though the officials did not spell out the new price for the carrier, they said India has agreed to release extra funds for the upgradation works on the Kiev class carrier after an assessment by a naval team led by Rear Admiral P K Nair and a group of Russian experts of contractors and vendors.
The new deal could be tied up later this week after Indian Defence Secretary Vijay Singh's negotiations with his Russian counterpart. Singh has been sent to Moscow by the Defence Minister A K Antony, reflecting the new government's resolve to speed up all defence purchases.
Any fresh deal worked out would have to have the concurrence of the Cabinet Committee of Security."The negotiations were successful," Sevmash CEO Nikolai Kalistratov was quoted as saying by ITAR-TASS, without giving details of the exact figures involved.
Under the US $ 1.5 billion package deal signed in 2004, Russia was to upgrade the vessel for US $ 974 million. Later citing the cost escalation due to additional work required and depreciation of dollar value, Moscow demanded extra US $ 2.2 billion to complete the refit of the carrier to be inducted into the navy as INS Vikramaditya. This would have pegged the price of the carrier at a whopping US $ 3.7 billion. However, Indian sources have said in New Delhi earlier that a fresh deal could be tied up on payment of upto US $ 1billion extra.
The two sides have also signed a revised schedule of all types of pre-delivery trials of the upgraded aircraft carrier in 2011-2012. "Allocation of extra funds agreed by India would allow to increase the strength of workforce on the vessel to 2,500 to intensify its upgradation," Kalistratov said.
