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India, Russia end stalemate over Gorshkov's price deal

A file photo of Admiral Gorshkov

MOSCOW (PTI): After protracted re-negotiations, India and Russia have ended the stalemate over contentious price and technical issues for the Admiral Gorshkov aircraft carrier which had become an irritant in bilateral ties.

"There has been excellent progress in negotiations on technical issues and there has been a successful conclusion," Foreign Secretary Nirupama Rao told reporters on Monday, at the end of Prime Minister Manmohan Singh's talks with Russian President Dmitry Medvedev and Prime Minister Vladimir Putin on the second day of his three-day official visit to Moscow.

Details of the final price fixed for the sale of the aircraft carrier INS Vikramaditya were not immediately available.

Ahead of Singh's visit to Moscow, Indian officials said a price satisfactory to both sides has been worked out for the refitting and delivery of Admiral Gorshkov, thus ending a prolonged standoff over the key defence deal.

The two countries are close to finalising the agreement on the aircraft carrier, they said on Sunday.

Indian and Russian defence officials have been negotiating the price for the purchase of the refurbished USD 2.2-billion aircraft carrier for several years.

Moscow is now asking for USD 2.9 billion for the aircraft carrier, nearly thrice the price that was originally agreed between the two sides in 2004.

But New Delhi wanted the price to be scaled back to USD 2.1 billion. The official did not disclose what that "satisfactory price" was but said it is between what the two countries were negotiating over.

On the eve of the visit, Singh said he was confident that the two countries can work out "practical solutions" to end the stand-off in the Gorshkov deal.

Delays in refitting the Admiral Gorshkov aircraft carrier and huge cost overruns have been a particular concern with India. It had also put at unease the otherwise time-tested relationship between the former cold war allies.

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