India has found a “permanent solution” for the payment of arms from Russia, after the country has stalled planned purchases due to the threat of financial sanctions by the United States, the Economic Times reports citing Russian officials.
The resolution of the problem will allow Russia to begin supplies of the S-400 missile defense system within two years and all five regiments on order to be delivered by 2024, the report says.
While refusing to go into details as they “involve financial institutions on both sides,” senior Russian officials said that the solution to payments issue will also enable participation in upcoming Indian acquisition competitions like new generation submarines and fighter jets.
“For big contracts like the S400, we have found a permanent solution for the payments. The details are very confidential and there will be nuances in different contracts but the fact is that the solution is permanent,” said Vladimir Drozhov, deputy director, Federal Service for Military Technical Cooperation.
The official said the solution will apply to future Indo-Russian contracts as well and shared that exports worth over $14 billion are in the pipeline for the Indian armed forces.
Earlier it was reported that a Euro payment solution has been figured out and past payments have also been made using the rupee-ruble route. On the two upcoming big Indian competitions in which Russian companies are participating, the official said that Moscow is aware that the fear of sanctions will be used but is confident of overcoming the hurdle.
“In these new big tenders, we are realistic that sanctions will be used as an instrument to try to kick us out. We have found solutions to the payments for S 400 and the frigates deal and we will find a way to deal with the new tenders as well,” Drozhzhov said. He was referring to the competition for 110 new fighter jets to be made in India and a tender for six new conventional submarines to be produced in the country.
