Kaliningrad (Russia), Aug 6 (RIA Novosti) Russia's Yantar shipyard is negotiating a $60 million loan to enable it to complete the construction of three frigates for the Indian Navy, shipyard's director Igor Orlov said Wednesday.

Russia is building three Project 11356 Krivak IV class guided missile frigates for the Indian Navy under a $1.6 billion contract signed in July, 2006.

Orlov said the shipyard had previously taken out a $110 million loan from Russian national development bank Vnesheconombank (VEB) but was now forced to seek an additional $60 million loan due to 'financial constraints'.

He added that the problems had been caused by fluctuations in the ruble-to-dollar exchange rate.

'When the contract was signed, the rate was 28.2 rubles per one US dollar, but then it fell to 23.5 rubles,' he said, adding that the shipyard had lost about 500 million rubles as a result.

However, the current exchange rate is 31 rubles per $1.

Russia said in late June it would meet its obligations to deliver the frigates to India by 2012.

An industry official said the first ship would be floated out this year, the second, in spring 2010, and the third a bit later, adding that the Indian government had provided sufficient and timely project financing.