India signs $1.2b deal with Russia for 80 Mi-17 choppers
NEW DELHI: Even as they work towards resolving "outstanding issues'' over the lease of a nuclear-powered submarine and huge cost escalation in
aircraft carrier Admiral Gorshkov's refit, India signed a $1.2 billion deal with Russia on Friday to buy
80 Mi-17 V-5 helicopters.
IAF will get the Mi-17 medium-lift utility helicopters between 2010 and 2014 as per the contract, which also envisages an "offset'' obligation by Russia to the tune of $405 million.
The choppers, which will also be weaponised for combat operations, are slated to replace the 50 old Mi-8s in the IAF fleet -- which have already outlived their life span of 35 years -- and boost operations in high-altitude areas like Siachen and Ladakh.
Brushing aside criticism that the Mi-17 V-5s were based on outdated technology and have high life-cycle costs, officials said the choppers would be able to land at a height of 18,000 feet with their powerful engines, better avionics and night-flying ability.
Both the chopper deal and Gorshkov renegotiation were cleared by the Cabinet Committee on Security on Tuesday, as was first reported by TOI, just before Russian President Dmitry Medvedev's visit to India.
The bitter tussle between India and Russia over the Gorshkov contract has cast a dark shadow over their long-standing bilateral defence ties, which has seen New Delhi import military hardware and software from Moscow worth over $35 billion since the 1960s.
Russia had stunned India last year by demanding $1.2 billion more for the refit of the decommissioned Gorshkov, over and above the original $1.5 billion package deal signed in January 2004, under which India was to get the 44,570 tonne fully-refurbished carrier and 16 MiG-29K fighters by August 2008.
Then, after a flurry of top-level discussions and technical evaluations earlier this year, the cost escalation figure for the refit of Gorshkov -- rechristened INS Vikramaditya after India paid an initial $500 million -- jumped close to $2 billion. "It will take around three months for the new contract to be signed,'' said an official.
There are also some "minor problems'' with India's plan to lease the new Russian Akula-II class attack submarine `K-152 Nerpa' for a 10-year period beginning next year.
It may be mentioned that 20 sailors and technicians had died due to a toxic gas leak during first-ever sea trials of the nuclear-powered Nerpa on November 8.
Interestingly, the secret contract to lease the 12,000-tonne Nerpa, christened INS Chakra by India, was signed with Russia in January 2004, along with the original Gorshkov package deal.
There are indications that a part of the huge cost escalation in the Gorshkov deal could be linked to Russia demanding more for Nerpa over the initial $650 million.
India, of course, remains extremely concerned about Russia not sticking to delivery schedules, creating roadblocks in transfer of technology (ToT), jacking up costs midway through execution of agreements and failing to provide uninterrupted supply of spares.
