French President Francois Hollande. Photo: EPA/BGNES
France has officially “postponed” the delivery of the first of two warships, ordered by Russia, reports BBC.
French President Francois Hollande said the reason was Moscow's recent actions in Ukraine.
Hollande asserted Paris had not abandoned the project, but its fulfillment would be tied to the development of the situation in Eastern Ukraine.
He also reminded the EU was to adopt a new round of sanctions against Russia on Friday unless any "progress" has been observed in Russia's relations with Ukraine.
France had until now resisted pressure to halt the delivery, saying it had to respect an existing contract. Failing to deliver, could cost France EUR 1 B.
Russia's Deputy Defence Minister Yury Borisov said the French decision would not hold back Moscow's plans to reform its armed forces.
Official say the lucrative deal could be delayed until November.
"Although of course it is unpleasant and adds to certain tensions in relations with our French partners, the cancelling of this contract will not be a tragedy for our modernisation," he said, quoted by Itar-Tass news agency.
The Vladivostok, the first of the two helicopter carriers, was expected to have been delivered to Russia by late October.
The second, the Sevastopol, was to have been sent next year, although no mention of it was made in Hollande's statement.