India Inches Closer to Finalising $2.2 Billion Deal to Acquire Four Naval Warships From Russia
India and Russia have moved closer in finalising a deal of $2.2-billion for acquiring four advanced warships for the Indian Navy. The Centre has moved ahead with the deal with Russia
New Delhi, September 17: India and Russia have moved closer in finalising a deal of $2.2-billion for acquiring four advanced warships for the Indian Navy. The Centre has moved ahead with the deal with Russia, just days after India signed the Communications Compatibility and Security Agreement (COMCASA) with the United States. According to a report published in the Economic Times, India will sign an agreement with Russia to procure four advanced Talwar-class frigates under project 11356 for the Navy during a summit between President Vladimir Putin and Prime Minister Narendra Modi in the Capital in October.
Two of the ships will be manufactured at the Goa Shipyard, while the rest will be bought directly from Russia’s Yantar shipyard. According to the report, the clearance procedure before the signing is in the final stage so that India could make payments through the rupee-rouble route. Due to Countering America’s Adversaries through Sanctions Act (CAATSA) imposed by the US, the process to procure weapons from Russia have become complicated as Indian banks are unable to transfer money to defence companies in Russia. Now both the countries are framing the way out so that payment could be done in Indian rupee.
According to the report, the deal is being processed as a ‘2+2’ scheme where technology will be transferred to Goa Shipyard to construct two of the frigates from scratch. The frigates which are to be imported directly from Russia will be delivered within two years.
The government has nominated the state-owned Goa Shipyard. The Indian-made warships are likely to cost 30-50% more than the other two ships which are to be directly imported from Russian due to the cost of building infrastructure and transfer of technology. An intergovernmental agreement regarding the deal was signed in October 2016, but the price and technical consultations posed hurls in concluding the deal.
India already operates six of the Talwar-class frigates. The first three warships of this class were inducted between June 2003 and April 2004, while the next group of three warships was inducted between April 2012 and June 2013. The four frigates which are to be ordered will be more advanced versions.
(The above story first appeared on LatestLY on Sep 17, 2018 06:12 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).