Article Posted on : - Jan 22, 2010

A file photo of Admiral Gorshkov.

MOSCOW (PTI): Ending their haggling, India and Russia have finalised a "mutually acceptable" price for Admiral Gorshkov aircraft carrier, its exporter has said, claiming that the Indian navy would practically get a "totally new, state-of-the-art" ship that is seaworthy for 30 years.

Russia and India are currently working on an addendum to the contract on the building of the vessel, said Anatoly Isaikin, head of the Rosoboronexport arms exporting company.

"The negotiations are over, and a mutually acceptable solution for Russia and India has been found. The cost has grown, but the vessel's building time schedule has not been extended," Isaikin was quoted as saying by Itar-Tass.

"Now the cost problems have been removed, and the ship will be completed on schedule," Isaikin said.

He said the new document will fix the timeframe and cost of the work. However, he declined to say when the document will be signed by the two sides.

Isaikin said that now these agreements should be fixed in the addendum to the contract.

India had bought the warship in 2004 for USD 974 million, but Russian shipyard Sevmash hiked the price twice since 2007 and currently demands an additional USD 2.9 billion.

Describing refurbishing of Gorshkov as very complicated, Isaikin said his firm will deliver totally new, sophisticated warship to India which will be renamed as INS Viraat.

As "we have taken only the body of the aircraft carrier, and its equipment will be totally new, state-of-the-art, this means that practically a new ship will be built.

Isaikin acknowledged that "there has been a delay in the talks about the cost that has grown."

Though both sides were haggling over the final price of the aircraft carrier, the Sevmash shipyard in Severodvinsk continued to build the aircraft carrier, the report said.

Experts said earlier that the ship would be ready in 2012.

The Admiral Gorshkov, renamed INS Vikramaditya, is to replace INS Viraat carrier that is currently operational but is now 50 years old.

After modernisation, the Gorshkov is expected to be seaworthy for 30 years, the report said.

The Admiral Gorshkov was a modified Kiev class aircraft carrier of the Russian navy, originally named Baku. In 2004, it was sold to India for conversion into a Short Take-Off But Arrested Recovery configuration (STOBAR) carrier to be named INS Vikramaditya.

The ship was laid down in 1978 at Nikolayev South in Ukraine, launched in 1982, and commissioned in 1987. The delay in commissioning was largely caused by software bugs in the new command and control system.

The ship was renamed Admiral Gorshkov after the collapse of the Soviet Union in 1991, as the city of Baku was now in independent Azerbaijan.

On January 20, 2004, Russia agreed to sell the Admiral Gorshkov to India, though payment details are still being worked out. As of 2009, Russia is upgrading the ship by stripping all the weaponry from its foredeck to make way for a STOBAR configuration, with a ski-jump on the bow.