IAF
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man we are just spending 2% of our GDP, compare to Pakistan above 5% and China above 7%. first stop begging from USA then you can criticize Great INDIA...
Indian Acquisition of the Gorshkov
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man we are just spending 2% of our GDP, compare to Pakistan above 5% and China above 7%. first stop begging from USA then you can criticize Great INDIA...
applesauce
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man we are just spending 2% of our GDP, compare to Pakistan above 5% and China above 7%. first stop begging from USA then you can criticize Great INDIA...
he was trolling u guys but now ur gonna start this numbers thing?
where did you pull the 7% from??? so now china spends 300+ BILLION on defense? if you got it from someone else, where did THEY get it from?
yea the world says china spends more than it states(it does i agree) but even cia says its about 140 billion at about 4.2? percent-ish(thats CIA numbers, not a number I agree with but whatever)
but in the end military spending has to do with GPD and political climate, pakistan need to spend alot to present a creditble defense to india and india spend for local security and china however the last line is still as follows Pakistan cannot match India in terms of the budgetary allocations to defense and India cannot match China.
sidenote i really wanna see this carrier in action even if its just to see how the russian repair-refurb job is
---------- Post added at 01:05 AM ---------- Previous post was at 01:04 AM ----------
the russian are just pulling ya chain more money less product
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destiny
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Final accord on Gorshkov pricing by July-end
Final accord on Gorshkov pricing by July-end
NEW DELHI: India and Russia will reach a final agreement on the cost of overhauling the Admiral Gorshkov aircraft carrier by the end of this month, the Russia envoy here said Wednesday.
"Both sides are coming to terms on the price and the date for commissioning for the Indian Navy. It will be announced within a fortnight. I do not want to speculate on the costs... it could be more than $2 billion," said Russian Ambassador Vyacheslav Trubnikov, who shortly leaves Delhi after a five-year stint.
The current contract covers a complete overhaul of the ship and equipping it with modern weaponry, including MiG-29K Fulcrum aircraft and anti-submarine helicopters.
A joint Indian-Russian working group is negotiating and preparing a revised agreement on the Admiral Gorshkov (to be renamed INS Vikramaditya), which is to replace India's ageing INS Viraat carrier.
"What is important here is that both sides have expressed goodwill. India needs this aircraft carrier," said Trubnikov.
The aircraft carrier is currently docked at the Sevmash shipyard in northern Russia, with over 2,000 workers carrying out repairs.
Trubnikov, who has been credited for building closer ties between New Delhi and Moscow, bemoaned the fact that trade ties were not commensurate with the potential.
"It (trade) leaves much to be desired. Trade still remains a challenge... Though it is positive, that is not enough," he said.
"Bilateral trade last year was around $7 billion. That is nothing considering the potential there is in this globalised world, where we can find many more outlets to make the partnership profitable."
According to Trubnikov, the energy sector, military technical cooperation and colloboration in space were the three pillars that formed the basis of the relationship between both countries.
"Military technical cooperation is highly competitive. We must learn to modernise techniques. Russia has changed its philosophy from being a buyer-seller partner to seeking mutual benefits in technology," he said.
"Both countries are moving forward for joint production of a fifth-generation fighter aircraft and a multi-role transport aircraft."
Explaining the increasing importance of India-Russia relations in a developing multi-polar world, Trubnikov referred to the BRIC (Brazil, Russia, India and China) grouping that he reckoned will play a significant role.
"It is going to play a more and more significant role in the construction of an architecture for the future both militarily and economically."
Final accord on Gorshkov pricing by July-end
NEW DELHI: India and Russia will reach a final agreement on the cost of overhauling the Admiral Gorshkov aircraft carrier by the end of this month, the Russia envoy here said Wednesday.
"Both sides are coming to terms on the price and the date for commissioning for the Indian Navy. It will be announced within a fortnight. I do not want to speculate on the costs... it could be more than $2 billion," said Russian Ambassador Vyacheslav Trubnikov, who shortly leaves Delhi after a five-year stint.
The current contract covers a complete overhaul of the ship and equipping it with modern weaponry, including MiG-29K Fulcrum aircraft and anti-submarine helicopters.
A joint Indian-Russian working group is negotiating and preparing a revised agreement on the Admiral Gorshkov (to be renamed INS Vikramaditya), which is to replace India's ageing INS Viraat carrier.
"What is important here is that both sides have expressed goodwill. India needs this aircraft carrier," said Trubnikov.
The aircraft carrier is currently docked at the Sevmash shipyard in northern Russia, with over 2,000 workers carrying out repairs.
Trubnikov, who has been credited for building closer ties between New Delhi and Moscow, bemoaned the fact that trade ties were not commensurate with the potential.
"It (trade) leaves much to be desired. Trade still remains a challenge... Though it is positive, that is not enough," he said.
"Bilateral trade last year was around $7 billion. That is nothing considering the potential there is in this globalised world, where we can find many more outlets to make the partnership profitable."
According to Trubnikov, the energy sector, military technical cooperation and colloboration in space were the three pillars that formed the basis of the relationship between both countries.
"Military technical cooperation is highly competitive. We must learn to modernise techniques. Russia has changed its philosophy from being a buyer-seller partner to seeking mutual benefits in technology," he said.
"Both countries are moving forward for joint production of a fifth-generation fighter aircraft and a multi-role transport aircraft."
Explaining the increasing importance of India-Russia relations in a developing multi-polar world, Trubnikov referred to the BRIC (Brazil, Russia, India and China) grouping that he reckoned will play a significant role.
"It is going to play a more and more significant role in the construction of an architecture for the future both militarily and economically."
Mig-29
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Screaming Skull
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Monday, Jul 20, 2009
K.V. Prasad
NEW DELHI: India is all set to finalise the price tag of aircraft carrier INS Vikramaditya (Admiral Gorshkov), which would be closer to the revised demand made by Russia at $2.9 billion.
Authoritative sources in the Ministry of Defence say the figure is likely to be finalised next week when negotiators end discussions.
The Russian negotiators arrived here on July 10 and originally intended to stay till July 17.
The team has conveyed that the cost had been calculated as per the standards specified by its government and there was little room to de-escalate the cost, revised from its original price of $1.5 billion. This figure too had been later changed to $2.2 billion.
After the recent visit of Defence Secretary Vijay Singh, New Delhi was hopeful that the price would be closer to $2.2 billion; however, over the past one week, negotiations had moved in a direction that showed it would be closer to the re-revised demand, the sources said.
Eventually, it must be remembered that this is not a commercial negotiation between a buyer and a seller but a government-to-government engagement. Yet, the negotiations have been arduous, the sources said.
As per the 2004 contract, the aircraft carrier that is undergoing repairs and refit at the Sevmash shipyard, was to have been delivered last year, but it is now expected to be handed over by the end of 2012.
The Russian side was told during Mr. Singhs visit that the deadline would have to be adhered to. In a related development, Russian President Dmitry Medvedev was quoted as telling the builders, during his visit to the shipyard early this month, to ensure delivery of the aircraft carrier on time.
India has so far paid $602 million as advance to Russia, with a bulk of that amount being released this year.
Meanwhile, Director of National Maritime Foundation C. Uday Bhaskar told The Hindu, that the deal was important for India-Russia defence cooperation.
The Hindu : Front Page : Final price tag of Gorshkov to be close to $.2.9 billion
Mig-29
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'Second-hand' Gorshkov costlier than new warship: CAG
The Indian Navy's purchase of the Russian-built aircraft carrier Admiral Gorshkov, already mired in controversy, has been criticised
by the Comptroller and Audit General (CAG) as the "second-hand" warhorse will be 60 percent costlier than a new one and there is a risk of further delay in its delivery.
"The objective of inducting an aircraft carrier in time to fill the gap in Indian Navy has not been achieved," the CAG said in its annual report released on Friday.
"The cost of acquisition has more than doubled to USD 1.82 billion in four years. At best Indian Navy would be acquiring, belatedly, a second-hand ship with a limited life span by paying significantly more than what it would have paid for a new ship," it said.
The purchase of Admiral Gorshkov faced controversy when Russia escalated the price for its refitting in 2007 and also pushed back its delivery date.
According to the CAG report, the platform is scheduled to be delivered by 2012 and would be due for its second refit in India by 2017.
Moreover, the CAG report predicts that the Russian shipyard might as well fail to stick to the scheduled delivery date.
"Overall work progress continued to be slow and needed to be accelerated to meet even the revised scheduled. Given the work needed to be done, preceeding the undocking and the cascading effect of delay in undocking on downstream activities, there was a risk that the delivery acceptance trials of the ship would not be completed by 2012," the report said.
"It can be seen that Indian Navy was acquiring a second-hand refitted aircraft carrier that had half the life span of and was 60 percent more expensive that a new one," said the report.
Despite the exorbitant price tag, the CAG report points out the carrier has limited operational capabilities and certain key capabilities which would enable the ship "to meet potential threats or challenges" had either not been provided for or had been postponed to a later date.
"The anti-aircraft missile complex selected to be fitted in the ship failed during the trials and the refurbishment contract was concluded without the missile system... This implies that the ship would not have a CIWS (Close-In Weapon System) till her first refit in India in 2017," revealed the report.
The CIWS is a vital naval shipboard point weapon for detecting and destroying incoming anti-ship missiles and enemy aircraft at short range.
'Second-hand' Gorshkov costlier than new warship: CAG - India - NEWS - The Times of India
The Indian Navy's purchase of the Russian-built aircraft carrier Admiral Gorshkov, already mired in controversy, has been criticised
by the Comptroller and Audit General (CAG) as the "second-hand" warhorse will be 60 percent costlier than a new one and there is a risk of further delay in its delivery.
"The objective of inducting an aircraft carrier in time to fill the gap in Indian Navy has not been achieved," the CAG said in its annual report released on Friday.
"The cost of acquisition has more than doubled to USD 1.82 billion in four years. At best Indian Navy would be acquiring, belatedly, a second-hand ship with a limited life span by paying significantly more than what it would have paid for a new ship," it said.
The purchase of Admiral Gorshkov faced controversy when Russia escalated the price for its refitting in 2007 and also pushed back its delivery date.
According to the CAG report, the platform is scheduled to be delivered by 2012 and would be due for its second refit in India by 2017.
Moreover, the CAG report predicts that the Russian shipyard might as well fail to stick to the scheduled delivery date.
"Overall work progress continued to be slow and needed to be accelerated to meet even the revised scheduled. Given the work needed to be done, preceeding the undocking and the cascading effect of delay in undocking on downstream activities, there was a risk that the delivery acceptance trials of the ship would not be completed by 2012," the report said.
"It can be seen that Indian Navy was acquiring a second-hand refitted aircraft carrier that had half the life span of and was 60 percent more expensive that a new one," said the report.
Despite the exorbitant price tag, the CAG report points out the carrier has limited operational capabilities and certain key capabilities which would enable the ship "to meet potential threats or challenges" had either not been provided for or had been postponed to a later date.
"The anti-aircraft missile complex selected to be fitted in the ship failed during the trials and the refurbishment contract was concluded without the missile system... This implies that the ship would not have a CIWS (Close-In Weapon System) till her first refit in India in 2017," revealed the report.
The CIWS is a vital naval shipboard point weapon for detecting and destroying incoming anti-ship missiles and enemy aircraft at short range.
'Second-hand' Gorshkov costlier than new warship: CAG - India - NEWS - The Times of India
Gabbar
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Glaring lapses in Gorshkov, Scorpene, Hawk defence deals: CAG
NEW DELHI: Sleazy wheeling and dealing, huge delays and financial irregularities continue to pervade all defence deals. The Comptroller and Auditor
General has now hammered the defence establishment for glaring lapses in the two biggest naval projects acquisition of Russian aircraft carrier Admiral Gorshkov and indigenous construction of six French Scorpene submarines.
This comes even as India under Russian pressure is getting ready to shell out almost $2 billion (Rs 9,680 crore) over and above what was initially a `fixed price contract' of $974 million for Gorshkov's refit, while the Rs 18,798-crore project to construct six Scorpenes at Mazagon Docks has slipped two years behind schedule, as first reported by TOI.
A senior CAG official, in fact, dubbed the Gorshkov deal as the "biggest defence mess-up" ever, stopping just short of calling it a "scam". ``The defence ministry did not provide us with full cooperation and access to documents for Gorshkov. As for the Scorpene project, undue favour and financial advantage was shown to the French vendor,'' he said.
In its latest report tabled in Parliament on Friday, the nation's auditing watchdog also punched holes in several other major defence projects, including the Rs 8,120-crore project for 66 British Hawk AJTs (advanced jet trainers). Interestingly, this also comes at a time when India is negotiating a follow-on order for 57 more Hawks.
While the desperate need for an aircraft carrier, a modern submarine fleet and AJTs to train rookie pilots cannot be overstated, what the CAG report underlines is a sordid saga of squandering away of public money, without even a hint of long-term strategic planning, whichever be the political dispensation in charge.
If the earlier NDA regime inked the initial $1.5-billion package deal for Gorshkov and the Hawk AJT contract in the run-up to the 2004 general elections, the UPA government in its first avtaar finalised the Scorpene project in October 2005, amid swirling allegations of kickbacks.
Coming down particularly heavily on the Gorshkov affair, the CAG report said,
``Indian Navy is acquiring a second-hand refitted carrier that has half the life span and is 60% more expensive than a new one.'' Originally meant to plug the `five-year carrier gap' in the Navy's capabilities from 2007 to 2012, Gorshkov is still a `high-risk' proposition since its delivery acceptance trials may not be completed even by 2012, it added.
Russia, as reported earlier, is demanding a whopping $2 billion more over and above the initial $1.5 billion contract of January 2004, under which the carrier refit was pegged at $974 million and the rest earmarked for 16 MiG-29K fighters to operate from its deck.
The CAG report pointed to a 2004 naval assessment that a new aircraft carrier, with a life of 40 years, would cost $1,145 million and take 10 years to build.
Gorshkov, in turn, would run for only 20 years. ``The acquisition cost has more than doubled to $1.82 billion in four years,'' said CAG, taking the $1.2-billion figure demanded by Russia in 2007 into account.
Listing out Gorshkov's `limited operational capabilities', CAG in particular expressed worry that a close-in weapon system to detect and destroy incoming hostile missiles and aircraft would be fitted on it only during its first refit in India around 2017.
As for the Rs 18,798 crore Scorpene project, under which the six submarines were to be delivered between 2012 and 2017, CAG blasted the government for taking nine years to finalize it despite Navy's depleting underwater combat force-levels.
Navy's projections show it will be left with only nine out of its present fleet of 16 diesel-electric submarines 10 Russian Kilo-class, four German HDW and two virtually obsolete Foxtrot by 2012. ``This would lead to serious operational ramifications,'' said CAG.
The government's delay in finalising the Scorpene project led to increase in its costs by Rs 2,838 crore. ``The submarine design selected has also not proven its efficacy in any other navy,'' it said. ``Moreover, the contractual provisions resulted in undue financial advantage to the vendor of a minimum of Rs 349 crore, besides other unquantifiable benefits,'' it added.
As reported earlier, the project has been dogged by some controversy, with allegations of kickbacks made in the October 2005 contracts signed with two French companies Rs 6,135-crore with M/s Armaris (a DCN-Thales joint venture) for transfer of technology and construction design, and Rs 1,062-crore with M/s MBDA for sea-skimming Exocet missiles.
"Large concessions in respect of warranty, performance bank guarantee, escalation, arbitration, liquidated damages, agency commission were bestowed on the vendor," said CAG.
Similarly, CAG rapped the government for taking 22 years for finalising the Rs 8,120 crore project to acquire 66 Hawk AJTs, which were sorely needed to help train IAF rookie pilots on the intricacies of combat fighter jet flying and reduce crashes.
It also pointed out that the contract was concluded with BAE Systems in a single-vendor situation, without reviewing the `air staff requirements' laid down in 1987, as also slippages in delivery schedules, pricing anomalies in supply of spares and the like.
sudhir007
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Gabber Bhai can u provides me the link where it mentions that uk or any other European country built a new carrier at $ 3 B. only Italy built Cavour (I dont know what exact price it has) a/c which is small (weight 27000ton) can not fulfill our navy requirement and it is on V/STOL which can oprate only AV-8B Harrier & F-35B... although right now uk building a nul. Base a/c which cost around 6-8 B. if u think we have buying option in other country than can u tell me which one old a/c or new a/c did u think suitable for our navy
sancho
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BBC - Peston's Picks: Aircraft carriers' costs soar £1bn
5 billion pounds are 8,2 billion dollars for two Queen Elizabeth class aircraft carriers. A 65 000t carrier, that can carry 40 aircrafts!
INS Vikramaditya instead is 20 000 t lighter and can only carry half as much aircrafts, is already 30 years old, but cost only one billion dollar less then those new carriers. Really a bad decision from IN!
Also don't forget that INS Vikramaditya was meant to replace INS Viraat, that might be lighter, but can carry up to 30 aircrafts and that our Sea Harriers was upgraded to be in service till 2020. That means every VTOL carrier (new, or old) would be enough as a gap filler till our indigenous carriers arrives, without buying new aircrafts.
You mentioned Cavour class, also spanish Juan Carlos class that costs only around 1 billion dollar would been a good choice.
LHD Canberra
Now we pay way too much for an old carrier and aircrafts that wasn't even our first choice (IN was thinking about Rafale and F18) and the refit is so delayed that we also could wait for our indigenous carrier to replace Viraat.
Gabbar
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Cost escalation for Gorshkov's refit transparent: Russia
As the Indian audit watchdog CAG questioned the prudence of buying a second-hand aircraft carrier from Russia at an exorbitant cost of USD 1.82 billion, Moscow has said the cost escalation for refit of the warship 'Admiral Gorshkov' was transparent and being monitored by the Indian navy.
"At several occasions our leadership has given public statements on the issue. Each and every step in the process of the refit of the aircraft carrier is monitored by Indian navy's technical team and they have never raised objections," said Vyacheslav Davidenko, the official spokesman for the Rosoboronexport (ROE) state corporation.
The ROE is the Russian government's nodal agency for executing foreign defence contracts.
Davidenko refused to comment on the CAG report for 2008, released on July 24, which wondered why the Defence Ministry was buying the warship second-hand which now comes at "half its life-span" and about "60 per cent more expensive" than a new aircraft carrier.
He, however, said that "this is India's internal matter."
Anastasia Nikitinskaya, official spokesperson of the Severodvinsk-based Sevmash shipyard, has claimed the cost went up as Indian Navy had been constantly changing specifications, which were not included in the initial estimate for upgrading the 44.5-thousand-tonne Kiev class carrier commissioned in 1987 by the Soviet Navy and decommissioned after the collapse of the USSR.
As the Indian audit watchdog CAG questioned the prudence of buying a second-hand aircraft carrier from Russia at an exorbitant cost of USD 1.82 billion, Moscow has said the cost escalation for refit of the warship 'Admiral Gorshkov' was transparent and being monitored by the Indian navy.
"At several occasions our leadership has given public statements on the issue. Each and every step in the process of the refit of the aircraft carrier is monitored by Indian navy's technical team and they have never raised objections," said Vyacheslav Davidenko, the official spokesman for the Rosoboronexport (ROE) state corporation.
The ROE is the Russian government's nodal agency for executing foreign defence contracts.
Davidenko refused to comment on the CAG report for 2008, released on July 24, which wondered why the Defence Ministry was buying the warship second-hand which now comes at "half its life-span" and about "60 per cent more expensive" than a new aircraft carrier.
He, however, said that "this is India's internal matter."
Anastasia Nikitinskaya, official spokesperson of the Severodvinsk-based Sevmash shipyard, has claimed the cost went up as Indian Navy had been constantly changing specifications, which were not included in the initial estimate for upgrading the 44.5-thousand-tonne Kiev class carrier commissioned in 1987 by the Soviet Navy and decommissioned after the collapse of the USSR.
Gabbar
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Re-look at Gorshkov deal, thanks to CAG report
Having already paid up $602 million (Rs 3,010 crore) for a second-hand, 22-year-old Russian aircraft carrier, the government is now saying the deal is yet to be sealed with Russia, which is unlikely to return any money.
“No final decision has been taken (on Admiral Gorshkov),” Defence Minister AK Antony told the Rajya Sabha on Wednesday. The Comptroller and Auditor General (CAG), country’s top auditor, has criticised the government for buying a used carrier which costs 60 per cent more than a new one and will have a 20-year shorter life span.
When the NDA government was in power, India had contracted to buy the 45,000-tonne Gorshkov in January 2004 for $1.5 billion (Rs 7,500 crore, at current exchange rate), including $974 million (Rs 4,870 crore) for refurbishing the carrier.
The navy was at that time looking for a carrier as its only aircraft carrier, INS Viraat, was due to retire in 2007 and the Indigenous Aircraft Carrier was unlikely to be inducted before 2012.
The contours of the deal, however, have changed drastically over the last five years. The Russians now want $2.9 billion (Rs 14,500 crore) for the warship, while the defence ministry is bargaining for $2.2 billion (Rs 11,000 crore).
The government admitted that the Russians were demanding an obscene sum, but said no other country was willing to sell an aircraft carrier to India five years ago.
Seeking to allay fears that the navy would end up buying a lemon from Russia, Antony said the government would keep in mind the auditor’s criticism before endorsing renegotiated terms.
“The Russians have demanded a substantially huge amount. We are still negotiating the deal. No final decision has been taken.”
A re-negotiated contract will have to be approved by the Cabinet Committee on Security. As most components of the warship were Ukraine-made, Russia said it was unable to assess refurbishing cost, hence, the price revision, Antony said.
The CAG found that the cost of sea trials had spiralled many times over. Pegged at $27 million (Rs 135 crore), India will now have to shell out a huge $550 million (Rs 2,750 crore) for the trials.
The auditor said the 20-fold jump in price had created doubts about “the diligence exercised while estimating and negotiating costs”.
Having already paid up $602 million (Rs 3,010 crore) for a second-hand, 22-year-old Russian aircraft carrier, the government is now saying the deal is yet to be sealed with Russia, which is unlikely to return any money.
“No final decision has been taken (on Admiral Gorshkov),” Defence Minister AK Antony told the Rajya Sabha on Wednesday. The Comptroller and Auditor General (CAG), country’s top auditor, has criticised the government for buying a used carrier which costs 60 per cent more than a new one and will have a 20-year shorter life span.
When the NDA government was in power, India had contracted to buy the 45,000-tonne Gorshkov in January 2004 for $1.5 billion (Rs 7,500 crore, at current exchange rate), including $974 million (Rs 4,870 crore) for refurbishing the carrier.
The navy was at that time looking for a carrier as its only aircraft carrier, INS Viraat, was due to retire in 2007 and the Indigenous Aircraft Carrier was unlikely to be inducted before 2012.
The contours of the deal, however, have changed drastically over the last five years. The Russians now want $2.9 billion (Rs 14,500 crore) for the warship, while the defence ministry is bargaining for $2.2 billion (Rs 11,000 crore).
The government admitted that the Russians were demanding an obscene sum, but said no other country was willing to sell an aircraft carrier to India five years ago.
Seeking to allay fears that the navy would end up buying a lemon from Russia, Antony said the government would keep in mind the auditor’s criticism before endorsing renegotiated terms.
“The Russians have demanded a substantially huge amount. We are still negotiating the deal. No final decision has been taken.”
A re-negotiated contract will have to be approved by the Cabinet Committee on Security. As most components of the warship were Ukraine-made, Russia said it was unable to assess refurbishing cost, hence, the price revision, Antony said.
The CAG found that the cost of sea trials had spiralled many times over. Pegged at $27 million (Rs 135 crore), India will now have to shell out a huge $550 million (Rs 2,750 crore) for the trials.
The auditor said the 20-fold jump in price had created doubts about “the diligence exercised while estimating and negotiating costs”.
sudhir007
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Russia may not return money
Having already paid up $602 million (Rs 3,010 crore) for a second-hand, 22-year-old Russian aircraft carrier, the government is now saying the deal is yet to be sealed with Russia, which is unlikely to return any money.
“No final decision has been taken (on Admiral Gorshkov),” Defence Minister A K Antony told the Rajya Sabha on Wednesday. The Comptroller and Auditor General (CAG), country’s top auditor, has criticised the government for buying a used carrier which costs 60 per cent more than a new one and will have a 20-year shorter life span.
When the NDA government was in power, India had contracted to buy the 45,000-tonne Gorshkov in January 2004 for $1.5 billion (Rs 7,500 crore, at current exchange rate), including $974 million (Rs 4,870 crore) for refurbishing the carrier.
The navy was at that time looking for a carrier as its only aircraft carrier, INS Viraat, was due to retire in 2007 and the Indigenous Aircraft Carrier was unlikely to be inducted before 2012.
The contours of the deal, however, have changed drastically over the last five years. The Russians now want $2.9 billion (Rs 14,500 crore) for the warship, while the defence ministry is bargaining for $2.2 billion (Rs 11,000 crore).
The government admitted that the Russians were demanding an obscene sum, but said no other country was willing to sell an aircraft carrier to India five years ago.
Seeking to allay fears that the navy would end up buying a lemon from Russia, Antony said the government would keep in mind the auditor’s criticism before endorsing renegotiated terms.
“The Russians have demanded a substantially huge amount. We are still negotiating the deal. No final decision has been taken.”
A re-negotiated contract will have to be approved by the Cabinet Committee on Security. As most components of the warship were Ukraine-made, Russia said it was unable to assess refurbishing cost, hence, the price revision, Antony said.
The CAG found that the cost of sea trials had spiralled many times over. Pegged at $27 million (Rs 135 crore), India will now have to shell out a huge $550 million (Rs 2,750 crore) for the trials.
The auditor said the 20-fold jump in price had created doubts about “the diligence exercised while estimating and negotiating costs”.
Having already paid up $602 million (Rs 3,010 crore) for a second-hand, 22-year-old Russian aircraft carrier, the government is now saying the deal is yet to be sealed with Russia, which is unlikely to return any money.
“No final decision has been taken (on Admiral Gorshkov),” Defence Minister A K Antony told the Rajya Sabha on Wednesday. The Comptroller and Auditor General (CAG), country’s top auditor, has criticised the government for buying a used carrier which costs 60 per cent more than a new one and will have a 20-year shorter life span.
When the NDA government was in power, India had contracted to buy the 45,000-tonne Gorshkov in January 2004 for $1.5 billion (Rs 7,500 crore, at current exchange rate), including $974 million (Rs 4,870 crore) for refurbishing the carrier.
The navy was at that time looking for a carrier as its only aircraft carrier, INS Viraat, was due to retire in 2007 and the Indigenous Aircraft Carrier was unlikely to be inducted before 2012.
The contours of the deal, however, have changed drastically over the last five years. The Russians now want $2.9 billion (Rs 14,500 crore) for the warship, while the defence ministry is bargaining for $2.2 billion (Rs 11,000 crore).
The government admitted that the Russians were demanding an obscene sum, but said no other country was willing to sell an aircraft carrier to India five years ago.
Seeking to allay fears that the navy would end up buying a lemon from Russia, Antony said the government would keep in mind the auditor’s criticism before endorsing renegotiated terms.
“The Russians have demanded a substantially huge amount. We are still negotiating the deal. No final decision has been taken.”
A re-negotiated contract will have to be approved by the Cabinet Committee on Security. As most components of the warship were Ukraine-made, Russia said it was unable to assess refurbishing cost, hence, the price revision, Antony said.
The CAG found that the cost of sea trials had spiralled many times over. Pegged at $27 million (Rs 135 crore), India will now have to shell out a huge $550 million (Rs 2,750 crore) for the trials.
The auditor said the 20-fold jump in price had created doubts about “the diligence exercised while estimating and negotiating costs”.
sudhir007
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No decision yet on Gorshkov: Antony- Politics/Nation-News-The Economic Times
NEW DELHI: In the line of fire over the CAG’s observations on the second-hand aircraft carrier Admiral Gorshkov, the government on Wednesday said
negotiations between India and Russia on its price escalation were still inconclusive and a final decision would be taken only after assessing all the criticism.
“Before entering into any contract, the government will go through all details. We will assess the criticism, including that of CAG, on the issue. At present, the Gorshkov price escalation is in the negotiation stage. Nothing has been finalised,” defence minister A K Antony assured the Rajya Sabha.
Russia had demanded a substantial increase in the price, he told the House while responding to a supplementary on the CAG’s criticism that the “second-hand” carrier will be 60% costlier than a new one and there is the risk of further delay in its delivery.
India bought the 45,000-tonne Gorshkov from Russia in January 2004 for $974 million, which included its refit and repair. Russia made an additional demand for $1.2 billion towards the escalating cost of the work. The repair costs were revised thrice since 2007 and a final demand for additional $2.9 billion was made in February this year.
“We had entered into a contract with Russia in 2004 to buy Admiral Gorshkov. However, that country faced a lot of difficulties during the intervening period. Subsequently, government was quoted a fresh price,” Mr Antony said. He admitted that repair and refit of Gorshkov was coming at a “substantially huge” price.
He said when India started searching for an aircraft carrier, there were very few manufacturers in the world. “After an elaborate search, no country except Russia was willing to give it to us. The decision to acquire it was taken in consultation with the Navy, as per the price quoted by Russia then,” he said.
The CAG report tabled last week said the Gorshkov would have limited operational capabilities and certain key capabilities had either not been provided for or been postponed to a later date. “The anti-aircraft missile complex selected to be fitted in the ship failed during the trials and the refurbishment contract was concluded without the missile system...This implies that the ship would not have a CIWS (Close-In Weapon System) till her first refit in India in 2017,” the report said.
NEW DELHI: In the line of fire over the CAG’s observations on the second-hand aircraft carrier Admiral Gorshkov, the government on Wednesday said
negotiations between India and Russia on its price escalation were still inconclusive and a final decision would be taken only after assessing all the criticism.
“Before entering into any contract, the government will go through all details. We will assess the criticism, including that of CAG, on the issue. At present, the Gorshkov price escalation is in the negotiation stage. Nothing has been finalised,” defence minister A K Antony assured the Rajya Sabha.
Russia had demanded a substantial increase in the price, he told the House while responding to a supplementary on the CAG’s criticism that the “second-hand” carrier will be 60% costlier than a new one and there is the risk of further delay in its delivery.
India bought the 45,000-tonne Gorshkov from Russia in January 2004 for $974 million, which included its refit and repair. Russia made an additional demand for $1.2 billion towards the escalating cost of the work. The repair costs were revised thrice since 2007 and a final demand for additional $2.9 billion was made in February this year.
“We had entered into a contract with Russia in 2004 to buy Admiral Gorshkov. However, that country faced a lot of difficulties during the intervening period. Subsequently, government was quoted a fresh price,” Mr Antony said. He admitted that repair and refit of Gorshkov was coming at a “substantially huge” price.
He said when India started searching for an aircraft carrier, there were very few manufacturers in the world. “After an elaborate search, no country except Russia was willing to give it to us. The decision to acquire it was taken in consultation with the Navy, as per the price quoted by Russia then,” he said.
The CAG report tabled last week said the Gorshkov would have limited operational capabilities and certain key capabilities had either not been provided for or been postponed to a later date. “The anti-aircraft missile complex selected to be fitted in the ship failed during the trials and the refurbishment contract was concluded without the missile system...This implies that the ship would not have a CIWS (Close-In Weapon System) till her first refit in India in 2017,” the report said.
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