Moscow, March 10, 2006 (Kommersant)

Russia's Deputy PM and Defense Minister Sergey Ivanov has backed up the state-controlled Kaliningrad Yantar in its effort to execute the contract for constructing three frigates for Indian Navy worth nearly $1.6 billion.

Ivanov's decision ended the fight of several months between two shipbuilders, Mezhprombank's Severnaya Verf of St. Petersburg and Kaliningrad Yantar. Both of them were eager to construct for Indian Navy three frigates of Project 11356.

In 2003 to 2004, St. Petersburg Baltic Works built and handed over to India three frigates of Project 11356 worth $1 billion. A new contract for another trio has been negotiated since 2002.

The talks proved more than fruitful. The new contract that is expected to be sealed this March sets forth an option for building one or two frigates to add to the nearly $1.6-billion construction of three frigates.