India pays USD 102 mn to speed up refit of Gorshkov
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Last Updated: Tuesday, September 08, 2009, 16:40
Moscow: India has paid another staggering USD 102 million to Russia, to speed up refit work on the aircraft carrier Admiral Gorshkov, pending a final agreement on a huge price hike of almost USD 2 billion demanded by Moscow.

"The advance payment of USD 102 million has given a fillip to repairs and refit works. The workforce would be increased to 2500 for work in two shifts," spokesperson of the Sevmash shipyard Anastasia Nikitinskaya said as Russian officials committed that they would meet the 2012 delivery deadline.

The increasing delay in the delivery of the warship has been described by President Dmitry Medvedev as the 'sole irritant' in Indo-Russian relations.

The issue came up in the delegation level talks between President Pratibha Devisingh Patil and her Soviet counterpart on September 3, during her first state visit to the country.

Director General of Severodvinsk-based Sevmash shipyard Nikolai Kalistratov along with his Chief Engineer was also present at the talks held at Kremlin.

Under the initial USD 1.5 billion contract signed in New Delhi in January 2004, Russia was to deliver retrofitted aircraft carrier in August 2008.

However, the Sevmash shipyard later demanded that USD 974 million allocated for the upgradation of the 44.5 thousand ton vessel, given to the Indian Navy 'free of cost', was not sufficient and demanded an additional sum of USD 2.2 billion.

According to Chairman of Russian Technologies State Corporation, Sergei Chemezev, the talks are currently underway for negotiating a new agreement, which may be signed in mid-October.

An Indian delegation is expected in Moscow later this month to finalise the accord, even as media reports have suggested that New Delhi's final offer was to pay an additional amount of USD 1.2 billion.

Sources here say that although the cost escalation was a 'natural' process due to changed requirements of the Indian Navy, a lot of money paid by India had 'dried up' in the banks for almost four years, with practically no work done on the warship.

Upgradation of Gorshkov, to be inducted as INS Vikramaditya, is expected to be completed in 2011, after which it would undergo sea-trials for delivery in 2012.

Bureau Report

First Published: Tuesday, September 08, 2009, 16:40

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