India is the Russian defense industry's latest beneficiary:
When Russia gave India a retired Soviet aircraft carrier five years ago, New Delhi was delighted -- little realising the vessel would turn into a costly white elephant.
Russia, India's longtime weapons supplier, said in 2004 it would give the country the 44,570-tonne "Admiral Gorshkov" as a gift, provided Delhi paid a Russian shipyard 974 million dollars to refurbish the carrier.
Since then, the price has skyrocketed for fixing up the 27-year-old ship, which was decommissioned after the collapse of the Soviet Union.
In 2007, Russia demanded 850 million dollars more, citing cost escalations. Then, six months ago, Russia startled India with another demand -- this time for 2.9 billion dollars.
It also pushed back the ship's delivery by four years to 2012 -- a year after India must mothball its last remaining aircraft carrier, the British-origin INS Viraat.
Now India's national auditor has waded into the row, saying the navy could have paid less for a new carrier.
What's this mean in the long-term? India moves away from the Russian kit they've used for decades, buys more US-NATO gear (hopefully, I'm a big India fan... would like to see our alliance tightened).
--John Noonan
