India turns down cost-escalation demands by Russia for Adm Gorshkov refit again: report

03 Nov 2008

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Unconfirmed reports suggest that for the second time India's finance ministry has rejected a proposal from the defence ministry to grant an additional $1.2 billion in funds that would enable a Russian shipyard to complete a hugely delayed retrofit programme of a decommissioned aircraft carrier Admiral Gorshkov (Indian designation-INS Vikramaditya).

The retrofit programme had originally been contracted at a cost of $1.5 billion, but ran into problems after Russians claimed that original estimates were not fully accurate and that additional funds were now required to complete the project.

India has already advanced up to two thirds of the programme cost to the Russians but has suspended all payments since January 2007..Consequently, the delivery date of the 44,500 tonne carrier has slipped from the revised 2009 date to at least 2012, provided the standoff between both sides is resolved.

The Indian navy has already ordered 12 MiG-29K fighters and four MiG-29KUB trainers, which are already due for delivery.

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