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India to pay $2.3 bln for Admiral Gorshkov

12/18/2009 

Russia and India agreed in final cost of overhaul and upgrade of aircraft carrying cruiser Admiral Gorshkov which will be renamed into Vikramaditya while in Indian Navy, informs IANS. According to agreement, total cost of works will make $2.3 bln, including $722 mln already paid by India.

According to IANS, Russia evaluated total cost of modernization as $2.9 bln; however, in the course of talks it was decided to reduce price down to $2.4 bln and then – to $2.3 bln. Along with price reduction Russian party agreed to install additional equipment without extra pay.

Under the agreement reached, India will not lay a claim and penalty provisions upon Russia in connection with displacement of ship delivery date to 2012; it was initially planned that Indian Navy would receive Admiral Gorshkov in 2008.

It was reported on Dec 7, 2009 that Russia and India had agreed in terms and cost of the carrier's modernization. The agreement was reached during visit of Manmohan Singh, Indian Prime Minister to Russia. The contract on modernization and delivery of Admiral Gorshkov to Indian Navy was signed in 2004, eight years after the carrier was decommissioned. According to preliminary transaction terms, total cost of cruiser refitting would be $1.5 bln. The half was planned for procurement of deck-based fighters MiG-29K/KUB.

Transaction of Admiral Gorshkov is considered unprofitable both in Russia and in India. In particular, Indian authorities consider construction of domestic carrier would be cheaper and its lifetime would be twice longer. In February 2009 India launched construction of its first aircraft carrier which is to be delivered to the Navy in 2014. Late November 2009 Indian Navy issued tender for an air group for new Indian carrier.

Indian authorities intend to purchase one more parcel of 29 MiG-29K deck-based fighters from Russia. Until India gets modernized Admiral Gorshkov, delivered fighters will be attached to naval base at Goa.

Source: Lenta.Ru, photo: aircraft carrier Vikramaditya

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