This follows its impasse with the Indian Navy over the payment of Rs 5 crore for immediately refurbishing the ship.

``Though we haven't taken a final decision yet, in all probability we will be backing out of the project,'' Urban Development Secretary K Nalinakshan said. The navy was simply not prepared to listen to the state government's viewpoint, he said. The state government had merely asked the navy for a firm assurance that it would be repaid the Rs 5 crore it will spend on the project, in case the consultants said it was unviable.

The Vikrant has not had a survey of its underwater hull since 1993 after when the navy decided to decommission her. The ship's corroding hull plates have been a cause for concern and have led to frequent leaks in the vessel in the last few years, hence the urgencyin immediately sending the ship for a refit.

But lobbying hard for a maritime museum, the navy on its part has also to decided to scrap the ship. Senior naval officials told this newspaper that destoring, or the removal of all equipment from the ship would commence in a month's time after which she would be towed out of her berth.

The Vikrant, which was decommissioned in January 1997, has been occupying valuable berth space at the naval dockyard's Cruiser Wharf. The navy says it needs this berth for its sole aircraft carrier INS Viraat which is to shortly go in for a two-year refit.