In another bid to iron out differences over cost escalation of weapons systems, including the aircraft carrier Admiral Gorshkov, Indian and Russian defence officials open crucial talks next week.

The talks are being held after months of intensive informal consultations and exchange of communication between the two sides on the issues, defence officials said.

A Russian defence delegation and representatives of its armament industry arrives this month-end.

The delegation will hold talks with Indian officials led by defence secretary Vijay Singh and top officials of defence & finance.

Delivery of the naval carrier, which was scheduled in August next year, has been hit by Russians' demand for a whopping 1.5 billion dollars more as the warship now being upgraded in its shipyards would need almost 2,000km of extra wiring to make its command and operational integration effective.

Under a contract signed in 2004, India had agreed to pay $1.2 billion for revamp of the carrier.