MOSCOW: Russia’s defense related sectors increased production by 2.5% in the first quarter, year-on-year, a Russian deputy prime minister said on Tuesday.
“There is not a whiff of a crisis or any macroeconomic problems here,” Sergei Ivanov, who oversees the defense industry as part of his cabinet tasks, told a news conference hosted by RIA Novosti.
He said that defense contracts in 2011-12 would be funded at the same level as in 2009, adding that by then Russia will be in a position to commence full-scale production of new weapons.
A federal official said in late May that Russia’s foreign defense orders totaled $35 billion.
Russian arms export monopoly Rosoboronexport earlier said its defense order portfolio was worth $27 billion.
Alexander Fomin, first deputy director of the Federal Service for Military Cooperation, which regulates Russia’s cooperation in the military and technical sphere with other countries, said the Russian defense industry had effectively “reached its ceiling” and could not take on any more orders.
“The industry does not stretch like a rubber bag. As in other countries, [our industry] has its limits. That’s an open secret,” he said.
Fomin said contracts signed for some weapon systems, especially long-range air-defense systems, stretched years into the future.
Sergei Chemezov, head of the state-run Russian Technology Corporation, said in February that the orders would provide domestic defense industry firms with contracts to keep them going for the next four to five years.
Russia’s defense industry currently employs 2.5-3 million workers, or 20% of manufacturing jobs.
