There is up to six months delay in the delivery of the two Krivak or Talwar-class stealth frigates under construction for the Indian Navy in Russia due to the war in Ukraine. The first frigate is now expected to be delivered by November 2023 and the second one by April 2024, according to Alexey Rakhmanov, Director-General of United Shipbuilding Corporation of Russia
Earlier, there was about nine-month delay in the schedule due to the COVID-19 pandemic. The first frigate, Tushil, was launched into water in October 2021.
“We see no more than six-month delay basically due to the fact that some equipment which we have ordered has fallen under sanctions... We do not see any sort of manufacturing issues... We don’t expect any further issues. Some catch of the schedule is also expected because we really value our relationship with our customer and we try to shrink the delay due to the obvious force majeure situation starting February this year,” Mr. Rakhmanov told the visiting media at the ongoing Army-2022 exhibition.
Responding to questions on issues of payments, he acknowledged that it has caused “some inconvenience” and it is more difficult, more expensive but it’s not impossible. “The dollar can only exist for pegging the rates... We are happy to discuss the contracts in Rubles, Rupees or other local currencies,” he added.
Rupee-Rouble arrangement
With Russia being shut out of the global SWIFT system for money transfers, India and Russia have agreed to conduct payments through the Rupee-Rouble arrangement. With several big-ticket deals including the S-400 under implementation, there are large volume of payments to be made. The Central banks of the two countries had extensively discussed this issue and small payments have been resumed. Officials stated that modalities to undertake larger payments are still being worked.
In October 2016, India and Russia signed an Inter-Governmental Agreement for the four stealth frigates, after which a $1-billion deal was signed for direct purchase. In November 2018, the Goa Shipyard Limited (GSL) signed a $500 mn deal with Rosoboronexport of Russia for material, design and specialist assistance to locally manufacture the two frigates, and in January 2019, the contract was signed between the Indian Defence Ministry and the GSL. All the ships are powered by engines from Zorya Nashproekt of Ukraine.
As per schedule, the GSL is scheduled to deliver the first ship in 2026 and the second one six months later. Defence officials had expressed confidence that any delays could be offset as the delivery is few years away.
As reported by The Hindu last year, there was an approximately eight-month delay in construction due to COVID-19 and the first of the two ships from Russia is scheduled to be delivered by mid-2023.
The basic structures of two frigates were lying at the Yantar shipyard in Russia which are now being finished. The Indian Navy already operates six of these frigates weighing around 4,000 tonnes each.
