Concerns were raised over the acquisition of 'second hand' aircraft carrier Admiral Gorshkov after a '20 time' cost escalation and a major delay in its delivery.
The CPI(M) and Samajwadi Party today raised concerns over the acquisition of 'second hand' aircraft carrier Admiral Gorshkov for the Indian Navy after a '20 time' cost escalation and a major delay in its delivery and demanded a clarification from the government on the issue.
"The comptroller and auditor general (CAG) has seriously questioned the government's decision to purchase the second hand aircraft carrier. The defence minister should make a statement and clarify what is the reason and why it is being purchased after its price has been escalated 20 times," CPI(M) leader Basudeb Acharia said in Lok Sabha.
He was promptly supported by former defence minister and SP chief Mulayam Singh Yadav who said the government should also clarify why Gorshkov was being acquired when its remaining life span was only 20 years instead of a new one which would have run for 40-50 years.
Acharia said the deal was signed in 2004 and the original price was $875 million.
After "protracted negotiations" of over two years, "you will be surprised to know that the price was escalated by 20 times ... to $1.2 billion and that too for a second hand aircraft carrier which has completed half of its life," the CPI(M) leader said during Zero Hour.
The issue was raised in the backdrop of a CAG report which pointed out that the refitted Russian aircraft carrier was coming after spending half its life span and was "60% more expensive than a new one".
"The acquisition cost has more than doubled to $1.82 billion in four years", taking into account the $1.2 billion figure demanded by Russia in 2007," the CAG had said.
India and Russia are in the last leg of negotiations on the cost of repair and refit of Admiral Gorshkov and the final price was likely to be between $2.2 billion and $2.9 billion.
India had signed the agreement in 2004 for the aircraft carrier and sent it for refit to the Sevmash Shipyard in Russia. That apart, India also bought 16 MiG-29Ks to operate on the warship at a cost of $650 million.
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