MOSCOW: State defense contracts will not be subject to cuts this year despite the ongoing financial crisis, Russia's deputy defense minister said on Monday.
“State arms and materiel orders will be fulfilled in the volumes planned in the budget,” said Lyubov Kudelina.
Kudelina said the Defense Ministry would transfer 65 billion rubles ($1.9 billion), to producers by the end of this week. She also said the ministry would transfer 35% of military contract payments in the first quarter of 2009.
The government is to disburse a total of 1.3 trillion rubles ($37 billion) to defense contractors this year.
The state arms production budget for 2009-11 has been approved at 4 trillion rubles ($115 billion).
Prime Minister Vladimir Putin said last week that Russia's major aircraft maker, MiG Corp., would receive 11 billion rubles ($308 million) in the first quarter of the year as part of a 17.3 billion-ruble ($485 million) state defense contract.
He also said the company had losses of some 11 billion rubles in 2008, and announced that he had signed a resolution allocating a further 15 billion rubles ($417 million) in federal budget funds to the corporation.
Last year, MiG, along with other “strategic” companies, was promised funding through the government's anti-crisis package, specifically firm production orders from the Russian Air Force.
