Diplomatic and Military Affairs

Putin promises to pay arms makers up front

Updated: 2011-05-12 08:45


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TOGLIATTI - Prime Minister Vladimir Putin said on Wednesday his government would pay Russian arms manufacturers up front to fulfil major contracts to equip Russian troops with new weapons.

Russia has promised to spend between 19 and 20 trillion roubles ($724.6 billion) over the next 10 years to renew its outdated armaments. President Dmitry Medvedev scolded the defence ministry and arms manufacturers on Tuesday for failing to deliver weaponry the military needed.

Following Medvedev's criticism, Putin promised to pay arms makers up to 100 percent of order prices ahead of delivery to support Russia's defence industry.

Despite its status as the world's second-largest arms exporter, military analysts say Russia's defence industry has stagnated since the collapse of the Soviet Union, relying on outdated designs.

"If we give you 100 percent (of the amount), you will put it into an account or direct it to other needs," Putin said, addressing industrial manufacturers in the car-producing city of Togliatti some 1000 km (620 miles) southeast of Moscow.

"We are ready to do it in order to support the enterprises, but ... provided we have guarantees that the orders will be fulfilled," he said.

In 2009 Medvedev signed off on orders for 30 ballistic missiles, five Iskander short-range missile systems, 300 armoured vehicles, 30 helicopters, three atomic submarines and a corvette class warship.

The industry's shortfalls and the need for an overhaul of the army's own ageing hardware were exposed during Russia's five-day war with Georgia in 2008 and by the economic crisis of 2009.

Medvedev ordered the defence ministry on Tuesday to meet the country's overdue procurement contracts by the end of May.



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