Nikolai, under whom three Rio Games qualified athletes -- Babar, Jaisha and Sudha Singh -- are undergoing training, has said that he has sent his resignation to the Athletics Federation of India citing poor infrastructure in the country.
He and AFI officials had a meeting with the SAI officials on Monday regarding the issues he had raised.
"We have a meeting with him and we have sorted out the issues with Nikolai. Whatever he has said, he is a damn good coach. We cannot lose him," Srinivas told reporters on the sidelines of a press conference addressed by Sports Minister Sarbananda Sonowal after a meeting with NSF officials on the country's preparation for the Rio Olympics.
Asked specifically if Nikolai was demanding more salary, Srinivas said, "It's not about that. He wants a contract of longer term. We will give him that."
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Srinivas also said that promising sprinter Dutee Chand, who recently won a gender case against the world athletics governing body IAAF, will be sent for a foreign training stint as she desired.
"She will continue training at the P Gopichand Academy in Hyderabad and she will be sent for a foreign training stint on government funding," Srinivas said.
The SAI DG also assured that the likes of shot putter Inderjeet Singh and triple jumper Arpinder Singh would get the funding under the Target Olympic Podium (TOP) Scheme.
"If they insist on taking more people, we have to finally agree with that. Maybe the government may have to spend Rs 10 lakh extra for an additional person and we can bear it," he said.
"This TOP Scheme is a kind of a special scheme. Even those who are not included in this, they are getting funds under the National Sports Development Fund or the Annual Calender for Training and Competition (given to federations by the sports ministry)," he added.