India pays $122 mn for Gorshkov Modification

Indian government has cleared an installment of $122 mn to Russia to ensure that the modification work on aircraft carrier Gorshkov, also known as Vikramaditya, continues till a settlement on the final price is reached. The installment was sanctioned earlier this month by the government following demands by Rosoboronexport, the sole Russian agency designated for importing or exporting defence equipment, according to India Strategic defence magazine. 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. Indian defense 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. 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 7,500 km of coastline should have at least five aircraft carriers.