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New Delhi: There may be no headway in the Admiral Gorshkov deal for the Indian Navy during Prime Minister Manmohan Singh’s upcoming visit to Moscow for the annual Indo-Russia annual summit. With both the sides unwilling to compromise on the price already settled, a 40-member Russian delegation has arrived in India to discuss the price hike.
Price negotiations for Gorshkov have dragged on for long, with both sides refusing to budge from their stands. “The Russian delegation is in town for the price negotiation of the aircraft carrier. But the current position is that both the sides have dug in their heels as far as the final price is concerned. What will matter now is who blinks first,” said a senior Indian Navy official, requesting anonymity.
While Russia is demanding $2.9 billion for the refurbishment work, Indian authorities are asking them to bring it down to $2.1 billion. However, the official said that till the time a final price tag is fixed for the 45,000-tonne Kiev class aircraft carrier, the work on the vessel will progress at the usual pace.
According to the agreement between the two sides, work on the aircraft carrier will not be stalled. The delivery date for the aircraft carrier fixed at 2012 will be honoured. “So far, around $650 million has been given to the Russian side for the refit work,” the official added. Price negotiations failed to take off even during the defence minister AK Antony’s recent visit to Russia.
So far, India had paid around $600 million after an agreement between the two countries in 2004, according to which the old aircraft carrier was offered for free, with India having to pay $974 million to modify and upgrade it in accordance with Indian Navy’s specifications.
However, in 2007 Russia said it had made a mistake in calculations to repair and modify Gorshkov, and demanded another $1.2 billion. Recently, it added yet another $700 million, saying that modifications and sea trials would be more expensive than estimated earlier. According to independent defence expert Ranjit Rai, “India rescued Sevmesh shipyard in northern Russia from closure by agreeing to buy Gorshkov and get it refitted—a deal which was hastily agreed in two days. In this hurry, fine points, including the ones relating to what was expected of Russia were overlooked.” The then naval chief Admiral Arun Prakash was made to believe that it was a...
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