‘Gorshkov price-hike to be taken to cabinet’

September 24th, 2008 - 6:51 pm ICT by IANS  

New Delhi, Sep 24 (IANS) Negotiations with Russia on the additional $1.2 billion it has demanded for the aircraft carrier Admiral Gorshkov - to be inducted in the Indian Navy as INS Vikramaditya - are in the final stages and the defence ministry is likely to seek cabinet approval next month for the increased price, a top official said Wednesday.”The raised cost will be taken to the cabinet most probably in October,” Defence Secretary Vijay Singh said.

The issue will also be discussed during Russian Defence Minister Anatoly Serdyukov’s visit here Sep 28-30, during which he will meet his Indian counterpart A.K. Antony. The two sides will also hold delegation-level talks.

After protracted negotiations, India signed a deal with Russia Jan 20, 2004 to buy the 45,000 tonne Gorshkov, along with 12 single-seat MiG-29 fighters and four twin-seat MiG-29 trainers for $1.5 billion.

Of this contracted amount, approximately $974 million was to be spent on upgrading and refitting the ship and $526 million on the MiG-29 jets and six Kamov Ka-31 attack and reconnaissance anti-submarine helicopters.

The delay in refurbishing the carrier has been attributed to two developments at the Russian shipyard where this is being undertaken.

The first was the realisation that the work involved in refurbishment had been grossly underestimated and much more would require to be done before the ship was made seaworthy.

The second was that the shipyard had transferred the bulk of the workforce engaged on the carrier to a new nuclear-powered submarine it has begun constructing.

The ship was to have been delivered in 2008 but is now likely to be handed over to the Indian Navy only in 2013 after 18 months of intensive sea trials.

The dramatic cost escalation has threatened to cast a shadow on long-standing defence ties between India and Russia. India depends on Russia for over 70 percent of its arms imports.

Meanwhile, the Russian government, on India’s request, has loaned $250 million to the Sevmash shipyard to ensure that the Gorshkov refit continues without any interruption.

The Russian government has also asked the yard to ensure that there are adequate personnel to work on the ship.

Sevmash, located in arctic Russia, has now recruited workers and engineers from across the country and at the same time abandoned some other projects, including a floating nuclear plant, to ensure that the work on the much-delayed Gorshkov project does not suffer any more.

The main work on the vessel’s hull is already done, and new equipment is being installed while the re-planning of interiors is under way. Indian officials have been posted at the generally wintry yard to monitor the work and to make sure that it is in accordance with the specifications drawn up by the Naval Headquarters in New Delhi.

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