Russia yields after Antony burst: assurances of scaled-down prices, steadier supplies

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    Russia yields after Antony burst

    SPECIAL CORRESPONDENT
    l Friday , June 5 , 2009 |

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    New Delhi, June 4: Upset with an India that is increasingly turning westwards to source its military hardware, Russia has promised to scale down the prices it has demanded and has come up with assurances of steadier supplies.

    Indian defence secretary Vijay Singh returned this morning from Moscow where he led a team of officials to a meeting of the India-Russia High-Level Monitoring Committee. The Russian side was led by the Director-General of Military Services, Dimitriev.

    Russia is by far the largest supplier of military equipment to India, and nearly 65 per cent of the Indian armed forces’ hardware is of Russian or Soviet origin. Annual military purchases from Russia total between Rs 15,000 crore and Rs 20,000 crore. India is Russia’s largest buyer.

    The Russian assurances come after an outburst by defence minister A.K. Antony last week at a public ceremony in the presence of the Russian ambassador. The defence minister expressed his “anguish” at the frequent delays in the delivery of hardware.

    “There is now an awareness in Russian industry of the competition they have to face (in India),” a senior defence ministry official said here today. He said there was an acknowledgement in the discussions that there were “bottlenecks and delays”.

    Russia indicated that it was willing to look at a downward revision of the price that it had demanded for the aircraft carrier, the Admiral Gorshkov.

    Russia had demanded an additional $2 billion for refurbishing the carrier after the vessel was contracted by India in 2004 for $964 million. India was willing to pay a total of $2.2 billion but Moscow kept insisting on a total of $ 2.9 billion.

    In the latest round of meetings, however, Moscow has indicated it is willing to compromise, senior officials said. A firm price will be contracted again by July.

    Last week, India paid up another $102 million for the carrier. So far, it has paid a total of $602 million.

    The delivery of the carrier, being negotiated since 1997, has also been delayed. “It is floating,” an official said, to indicate that work has progressed enough. The carrier is not likely to be with the Indian Navy before the end of 2012.

    The Russians were upset that the Indian Air Force had chosen Airbus’s MRTT refueller aircraft over the Russian IL-78, the senior official said. The Indian government has not yet decided the choice of refueller.

    The IAF’s mid-air refueller squadron is currently made up of Russian IL-78 aircraft but air headquarters has preferred the Airbus in trials.

    “Whatever decision is taken (on which refueller to buy) will be taken on sound commercial and technical grounds,” the senior defence official said. To override the Indian Air Force’s choice, however, would be difficult.

    The official said the talks related to product support, supply of spares for old equipment, upgrade of MiG-29s with the IAF and transfer of technology for the T-90 tanks for the Indian Army.


    The Telegraph - Calcutta (Kolkata) | Nation | Russia yields after Antony burst
     
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