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New Delhi. India has cleared an installment
of US$ 122 million to Russia to ensure that the
modification work on aircraft carrier Gorshkov,
aka Vikramaditya, continues till a settlement
on the final price is achieved.
The payment was sanctioned earlier this month
by the government following demands by Rosoboronexport,
the sole Russian agency designated for importing
or exporting defence equipment.
India had paid around $ 600 million initially
after an agreement between the two countries in
2004, according to which the old aircraft carrier
was gifted as free but India was to pay $ 974
million to modify and upgrade it in accordance
with Indian Navy's specifications.
In 2007 however, the Russians said they had made
a mistake in their calculations to repair and
modify Gorshkov, and demanded another $ 1.2 billion.
Recently, they have added still another $ 700
million saying that modifications, and then sea
trials, would be more expensive than as considered
by them earlier.
The total demand by the Russians now touches
$ 2,9 billion, instead of $ 974 million, or, approximately
one billion as originally contracted.
The delivery of the aircraft carrier has also
been pushed from 2008 to 2012-13, although repair
work on it is continuing without break at the
Sevmash shipyard in northern Russia on its Arctic
coast.
The Russian government had extended $ 250 million
to the shipyard in 2008, and now the installment
of $ 122 million being paid by India is also to
ensure that there is no break in the repair work,
sources told India Strategic.
Indian naval officials have been stationed at
Sevmash for the past several years to monitor
the day-to-day activity and to ensure that the
repair and modifications are in line with the
Naval Staff Qualitative Requirements (NSQRs),
the dispute over the additional monetary demands
notwithstanding.
India has naturally been reluctant to meet the
post-contract Russian demands, and even the Comptroller
General of India (CGI) has described the deal
as a mess. But the Navy needs Gorshkov as early
as possible as its only existing aircraft carrier,
Viraat, is on life extension and undergoing a
refit to serve for another few years.
It takes nearly 8 to 10 years to acquire an aircraft
carrier. Procedures within the Indian bureaucratic
system require two to three years, and then a
company which is ordered to build it, should take
another 5 to 8 years.
Although the Indian Navy is already building
one of its two aircraft carriers in design consultancy
with Italy's Fincantieri, it has no choice but
to go in for Gorshkov in line with its sanctioned
three-carrier planning. Ideally though, a country
the size of India with 7500 km of coastline should
have at least 5 aircraft carriers.
A Russian defence delegation was in New Delhi
in July but it refused to negotiate lower than
its demand for $ 2.9 billion.
Discussions though will continue.
The government's Cabinet Committee on Security
(CCS) is reported to have asked the Ministry of
Defence to continue the negotiations but has not
acceded to the two revised Russian demands.
It may be noted that the Gorshkov deal also involves
a related $ 740 million contract for 16 Mig 29K
aircraft. That deal is going smoothly and the
first four of these aircraft are likely to arrive
at INS Hansa, the Indian Navy training facility
in Goa, by year-end.
Ten pilots, initially trained by the US Navy
for carrier landing at its Naval Air Station,
Pensacola training facility, are now in Russia
training on the Mig 29Ks.
Four of these Mig 29Ks are twin-seaters for training
and the remaining 12 for routine operational flying.
The Navy will continue to operate the aircraft
from its ground stations as all of them should
be in India before the arrival of Gorshkov.
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