No renegotiation of Gorshkov's price: Navy Chief
Navy Chief Admiral Sureesh Mehta on Monday ruled out renegotiation with Russia for the price of the aircraft carrier Admiral Gorshkov and said delays would make India think about its defence relations with its longstanding partner. He, however, rejected opting out of the $1.5 billion deal signed in 2004.
The tough posturing by the Naval Chief came in the wake of Russia recently asking for $2.7 billion for the carrier renamed INS Vikramaditya, instead of the contracted price of $1.5 billion. The ship, now undergoing major refurbishment in Russia according to the Indian specifications, was supposed to be delivered to the Navy in 2008 and now it seemed the deadline could be extended by another two years.
Taken aback by the Russian proposal, the Ministry of Defence took the matter seriously and decided to take up the issue at high level and a Russian delegation was expected to land here later this week. Officials clarified that there was no provision for increasing the price of the deal in the original agreement.
The strategic and defence ties between the two countries, having stood the test of time, were now getting into rough weather with Russia adopting a rather business-like approach and no longer offering "friendly prices" to India.
This was true for defence as the three services had more than 70 per cent inventory of Russian origin. Coupled with this factor, the recent "cold reception" to Prime Minister Manmohan Singh and External Affairs Minister Pranab Mukherjee in Moscow was a pointer towards the relationship getting stretched.
Addressing a news conference here on the eve of the Navy Day, Mehta spoke at length about the Gorshkov deal and expressed concern over dilly-dallying by Russia. He went on to say such a delay would make India ponder over "where our defence relations are going to" and made it clear that there could be no renegotiation on the price of the carrier.
"We have paid more than $400 million for the carrier and we own it now," the Naval Chief said. "I have told the Government that the Navy's line is that we should not talk on renegotiating the price for the carrier," he said but ruled out any possibility of opting out of the deal.
As per the inter-Governmental contract, Russia was to deliver the carrier by August 2008. But now, Moscow wants revision of the price to a whopping $2.7 billion, citing major cable laying work of 2,400 km on the carrier.
"When we signed the deal, it was fixed-price contract, taking into account all eventualities of retrofitting. The retrofitting process will take at least two years. We have to see where our relations are going to with Moscow," said Mehta, who is also Chairman of Chiefs of Staff Committee.
"We should not pay anything more than what we have committed in the original contract," the Navy Chief said. Holding Russia responsible for delay in the delivery of the carrier, he blamed the Russian decision to divert a large number of qualified manpower to building its own new generation nuclear submarines.
"It was Gorshkov project which helped Russian shipyards provide jobs when their economy was down. With our money, there has been lot of prosperity in the (Russian) region," the Navy chief said.
"But now, sudden oil boom has brought about a lot of prosperity, enabling the Russians to launch new warships and submarines, diverting the workforce," he added. Mehta, however, reassured the nation that notwithstanding the delay, the Navy would have two carrier-borne groups operational in Bay of Bengal and Arabian Sea by 2015.
Elaborating upon the modernisation and acquisition plans of the force, he said the Navy had floated international tenders for purchase of eight long-range maritime reconnaissance aircraft. The planes were likely to join service within four years after identification of the vendor, Mehta said.
He said the Navy was also on course to float another Request for Proposals (RFP) for acquiring a Medium Range Maritime reconnaissance aircraft. About the Navy proposal to acquire Rotary-based Unmanned Aerial Vehicle NR-UAV, Mehta said this could be an indigenous project with the public sector Hindustan Aeronautics Limited (HAL) building the helicopter and buying sensors and other equipment from abroad.
He also said the Navy was finalising the RFP to buy medium range anti-submarine helicopters to replace the ageing Sea-King helicopters.