Russia is planning to carry out sweeping reforms of its defense industry in 2001 in line with plans to increase the country's military efficiency, Interfax cited Deputy Prime Minister Ilya Klebanov as saying Tuesday.
Klebanov said it was necessary to regroup the hundreds of Russian defence enterprises in a handful of holding companies, adding: "This will be the first year of real reform of the military-industrial complex for the past 10 years."
The deputy Prime Minister, who is responsible for the military-industrial complex, said too many defense firms were currently manufacturing the same products, which meant that not all of them could expect contracts from the state.
"Very tough decisions have to be made," Klebanov was cited as saying by Interfax.
In the aviation industry, for example, Klebanov said it was imperative to create one large aircraft manufacturing group because the existing firms would not be able to withstand international competition on their own.
Klebanov said Russian orders for military armaments were set to double as a result of government plans to renovate the country's aging military infrastructure.
Armament orders "would increase by 135 percent" compared to the year 2000, he told the RIA-Novosti news agency last week.
Under Russia's budget for 2001, adopted by parliament last week, defense spending is expected to total 218.9 billion rubles (7.8 billion dollars, 8.4 billion euros), accounting for 18.3 percent of the total budget.
Of that figure, a total 31.5 billion rubles was set aside for military and technical equipment.
The defense budget was revised upwards under pressure from the military lobby, which is very powerful in the State Duma lower house of parliament after the Kursk submarine disaster revealed deficiencies in the armed forces.
The Russian nuclear submarine Kursk sank with 118 people on board in the Barents Sea on August 12 in circumstances which are still unclear. There were no survivors.
Russia said recently it would slash 600,000 posts over the next five years from the three-million-strong armed forces in a bid to scale down its outsize military and boost efficiency in the post-Cold War era -- MOSCOW (AFP)
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