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The Russian “Free Gift” That Cost Indian Navy $3 Billion; Recalling The Shocking Story Of Admiral Gorshkov

Russia has long rivalled Western countries for the title of the world’s top arms exporter. Historically, Russian arms have offered few key advantages: they are technologically advanced, subject to fewer restrictions, and often more affordable.

The sophistication of Russian (historically Soviet) weapons has traditionally been a major draw for buyers seeking affordable and cutting-edge arms to bolster their military.

For instance, the American fifth-generation stealth fighter F-35 costs about $80-90 million per unit, with unbelievably high maintenance and life cycle costs that have made it the most expensive fighter jet in the world. Meanwhile, the base price of the Russian Su-57 fifth-generation stealth aircraft is significantly lower at $40-$50 million.

Similarly, the French Rafale and American F-16 cost more than the Su-34 and Su-35, and the American Abrams tanks cost more than the Russian T-90 Main Battle Tanks (MBTs).

According to analysts, this cost difference stems from a combination of factors, including design philosophies, economies of scale, and government subsidies to arms manufacturers.

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Notably, some Western-based analysts say that Russian arms cost less than Western arms because Moscow often upgrades existing Soviet-era platforms rather than developing entirely new systems, thereby avoiding the high R&D (Research and Development) costs associated with Western “clean-sheet” designs.

However, the comparatively low cost of Russian arms is mainly driven by a consistent focus on volume and mass production. In fact, some NATO officials and industry experts have called upon the United States to focus on scaling production to reduce the price of its arms, to make them more palatable to interested arms buyers.

India’s arms procurement from Russia dates back to the Cold War era, when the Soviet Union became a primary supplier in the 1960s, supplying aircraft such as MiG-21s. This relationship deepened over the decades, with Russia remaining India’s largest arms supplier despite the fall of the Soviet Union.

Some of the most advanced weapons in India’s arsenal are Russian, including the Su-30MKI, the S-400 air defence system, and T-90 tanks. 

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Not all Russian arms have proven to be cost-effective. Russia’s share in Indian arms imports fell from 55% in 2015-19 to 36% in 2020-24, the SIPRI 2025 report stated. Going by the trends, “India is shifting its arms supply relations towards Western suppliers, most notably France, Israel and the USA,” the report stated.

IAF veteran and seasoned military commentator, Air Marshal Anil Chopra (retd), recently explained in a EurAsian Times article: “It is well known and well-analyzed that while the initial cost of Russian platforms is nearly two-thirds of that of Western platforms, the life-cycle costs of many Russian platforms overtake those of Western platforms at a later stage. Such a comparative analysis was conducted by the IAF between the Mirage-2000 and the MiG-29, which were acquired roughly at the same time,” Air Marshal Chopra explained.

“The reasons include a shorter period for mandatory component replacements, longer repair cycles requiring larger inventories, and fewer hours to overhaul, among others. Also, historically, Russian fleets have seen lower serviceability percentages in IAF than their Western counterparts,” he added. 

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The Free Carrier That Cost India Billions Of Dollars 

Although India has been diversifying its arms purchases and investing more in its domestic defence industry over the last decade, there was a time when India would buy the majority of its arms from Russia amid ideological and political differences with the West.

During this period of Russian dependence, India went shopping for an aircraft carrier in the 2000s to bolster its maritime capabilities.

This is when it stumbled over the INS Vikramaditya, which was earlier Baku and later rechristened to Admiral Gorshkov.

Put into service in 1987, the carrier represented a unique design. With 12 massive SS-N-12 anti-ship missiles, up to 192 surface-to-air missiles, and two 100-millimetre deck guns, it was partly a heavy cruiser, and partly an aircraft carrier. 

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When the Soviet Union disintegrated in 1991, Russia inherited the carrier and renamed it Admiral Gorshkov. However, in 1994, the carrier suffered a boiler-room explosion and could only remain on the rolls of the Russian navy until 1996, after which it was mothballed.

In the mid-1990s, after the accident, Russia offered the partly damaged ship to India as a “gift.” But like all things that are too good to be true, it came with strings attached.

The caveat for this sale was that India would cover the costs of a major refit, modernization, and the purchase of compatible aircraft, such as MiG-29K fighters. This was seen as a way for Russia to generate revenue from upgrades and arms sales while helping India bolster its naval capabilities to protect against regional security threats.

India was faced with a dilemma. The Indian Navy’s only aircraft carrier of the time—INS Viraat—was fast becoming outdated. Since the service was not blind to the fact that carriers are tools of force projection, it knew it had to make a purchase, and make it soon.

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India did not have many choices. The US, France, and Italy were the only nations producing carriers at the time, but their ships were too expensive for India’s budget. 

Starved for options, India signed a formal agreement with Russia to purchase the Admiral Gorshkov in January 2004, following years of negotiations.

While the hull bore no cost, India was to bear the cost of converting the ship from a hybrid cruiser-carrier to a full-fledged STOBAR (Short Take-Off But Arrested Recovery) aircraft carrier. The original deal, which covered refurbishment work at Russia’s Sevmash shipyard, was valued at about $974 million. 

However, India probably underestimated the extent (and the resulting cost) of the big refit.

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Admiral Gorshkov was a massive ship, weighing 44,500 tons. About ten years old at the time, the carrier had been in mothballs for eight years.

The ship was to be converted by Russia from a helicopter carrier with a partial flight deck to an aircraft carrier with a flight deck that is slightly longer than 900 feet and a launch ramp.

It was supposed to get new deck elevators, new arrester wires to catch landing aircraft, new radars, and new boilers for propulsion. Additionally, new wiring would be installed throughout the ship, and all 2,700 rooms and compartments, spread across 22 decks, would be renovated.

However, Sevmash, primarily a submarine builder, lacked extensive experience with aircraft carriers, foreshadowing trouble.

By 2007, it had become evident that Russia’s Sevmash shipyard could not meet the ambitious schedule. Even worse, to finish the project, the yard needed more than twice as much money—a total of $2.9 billion.

A year later, Sevmash calculated that the carrier was only 49% completed. Even more appalling, a Sevmash executive proposed that India pay an extra $2 billion, claiming that the “market price” of a new carrier is “between $3 billion and $4 billion.”

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Mig-29
MiG-29K of INAS 303 executes a low approach to the aircraft carrier Vikramaditya in 2014. Via: Wikipedia

With the job halfway done and having already dropped $974 million, India could not afford to walk away from the deal. “If India does not pay up, we will keep the aircraft carrier,” one defence ministry official told RIA-Novosti, amid frictions over ballooning cost.

High-level diplomatic tensions ensued, with India accusing Russia of lowballing the initial estimate to secure the deal and then leveraging India’s dependence on the carrier for its blue-water navy ambitions.

In 2009, Russia sought yet another $700 million bump. In fact, the sea trials alone escalated from $27 million to a whopping $550 million.

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By 2010, India relented and agreed to a revised total of $2.35 billion for the refit alone, excluding aircraft, more than double the original figure. Some reports put the final tally at $2.9-3 billion, including all elements.

These cost overruns stemmed from underestimating the refit’s scope, the ship’s poor baseline condition, inflation in material costs, and Russia’s monopolistic position as the sole supplier at the time.

The carrier was finally handed over five years later than anticipated, in November 2013, and commissioned into the Indian Navy in November 2014.

This “free gift” apparently turned into a very expensive acquisition and proved that Russian arms may look cheap on face value, but sometimes they may not be as cheap when all things are considered.

This prompted a rethink in India, spurring it to diversify its supplier base and invest in indigenous projects like INS Vikrant. 

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