By VIVEK RAGHUVANSHI, NEW DELHI
India will withhold this month�s $74 million payment on its $740 million contract to buy 16 new MiG-29K aircraft, saying Moscow-based Russian Aircraftbuilding Corporation MiG (RSK MiG) is not on schedule to deliver the first aircraft to the Indian Navy by 2007, Defence Ministry sources said.
The Navy would be the first export customer to fly the MiG-29K fighter, which is still in the prototype stage in Russia.
Apart from apprehension about the delivery schedule, Defence Ministry sources said the government is concerned about aircraft price, which is about $10 million more than the ministry believes the plane is worth. The contract, signed by India�s former National Democratic Alliance government early this year, was based on a per-plane price of $46 million.
However, a ministry official said the new government will honor the deal made with RSK MiG.
The official said $148 million has been paid to date, but that the $74 million payment for November will not be made until a team from India evaluates the progress of the program. The team, comprising officials from the Navy and state-owned Hindustan Aeronautics Ltd., Bangalore, will visit RSK MiG this month to assess the production process and finalize contracts with Russian suppliers for spare parts and other equipment for the production of the MiG-29K.
RSK MiG executives here declined repeated requests for comment.
A diplomat in the Russian Embassy here said the ministry made its first payment on the contract in June, two months late, which would affect the delivery schedule. He also said the delivery schedule as stated in the contract will be met if India makes payments on time.
While neither the ministry official nor the Russian diplomat would detail that delivery schedule, the diplomat said, �The delivery of the aircraft is surely linked to the payment schedule.�
India is buying 16 MiG-29Ks to equip the Admiral Gorshkov aircraft carrier it is now having upgraded in Russia. Russia insisted that the aircraft carrier deal, signed in January, include a contract for MiG-29K fighters and Kamov Ka-31 helicopters. •
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India will withhold this month�s $74 million payment on its $740 million contract to buy 16 new MiG-29K aircraft, saying Moscow-based Russian Aircraftbuilding Corporation MiG (RSK MiG) is not on schedule to deliver the first aircraft to the Indian Navy by 2007, Defence Ministry sources said.
The Navy would be the first export customer to fly the MiG-29K fighter, which is still in the prototype stage in Russia.
Apart from apprehension about the delivery schedule, Defence Ministry sources said the government is concerned about aircraft price, which is about $10 million more than the ministry believes the plane is worth. The contract, signed by India�s former National Democratic Alliance government early this year, was based on a per-plane price of $46 million.
However, a ministry official said the new government will honor the deal made with RSK MiG.
The official said $148 million has been paid to date, but that the $74 million payment for November will not be made until a team from India evaluates the progress of the program. The team, comprising officials from the Navy and state-owned Hindustan Aeronautics Ltd., Bangalore, will visit RSK MiG this month to assess the production process and finalize contracts with Russian suppliers for spare parts and other equipment for the production of the MiG-29K.
RSK MiG executives here declined repeated requests for comment.
A diplomat in the Russian Embassy here said the ministry made its first payment on the contract in June, two months late, which would affect the delivery schedule. He also said the delivery schedule as stated in the contract will be met if India makes payments on time.
While neither the ministry official nor the Russian diplomat would detail that delivery schedule, the diplomat said, �The delivery of the aircraft is surely linked to the payment schedule.�
India is buying 16 MiG-29Ks to equip the Admiral Gorshkov aircraft carrier it is now having upgraded in Russia. Russia insisted that the aircraft carrier deal, signed in January, include a contract for MiG-29K fighters and Kamov Ka-31 helicopters. •
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