Russia's [Images] Sevmash shipyard, currently retrofitting aircraft carrier Admiral Gorshkov, on Tuesday said the warship would be ready for transfer to the Indian Navy in 2012 though the price escalation issue is yet to be resolved.

Announcing its readiness to begin sea trials for the carrier in 2011, the shipyard officials said these could be carried "provided all the financial issues are resolved."

"The successful solution of all the financial issues will enable the shipbuilders to sail the aircraft carrier out into the Barents Sea for trials. In the winter of 2012, the ship is expected to be finally refitted and trials will continue in the summer of that year," Sevmash officials were quoted as saying by RIA Novosti.

"At the end of 2012, the aircraft carrier is expected to be fully prepared for its transfer to the Indian Navy in accordance with the schedule approved by the Russian Navy," they said.

The Sevmash shipyard, which is retrofitting the 44.5 thousand tonne vessel, is asking for $1.2 billion in addition to the original agreed deal of $1.5 billion, which also includes the supply of MiG-29K fighter fleet.

As the talks are deadlocked, the makers of the MiG-29K fighters have indicated that they would begin deliveries of these aircraft on schedule by September this year.

Under a contract worth& $1.5 billion signed between Russia and India in 2003, Moscow [Images] was to deliver the carrier along with its compliment of MiG-29K fighters in August last year.

But just months short of the scheduled delivery, Moscow stunned New Delhi by asking for an increase in cost to almost double, saying the warship needed a lot of additional work and would have to undergo almost a year-long sea trial in Russian waters.