Russian Navy

State Defense Order 2011 is only 57% placed – Russian Government

05/25/2011

Currently, only 57% of State Defense Order 2011 has been placed, summarized Military Industrial Commission headed by Russian vice premier Sergei Ivanov on May 24.

Defense orders of 2011 are placed with delay again. Volume of advance payments transferred to executors is less than 20% of the planned level. "Mechanism of state contracts tied with defense companies with credits governmentally guarantee does not work so far", reports press service of Russian government. For instance, yet defense ministry has not signed contracts on 4th generation ships with JSC Sevmash shipyard.

Single-executor contracts were supposed to be signed till March 31, and tender-type defense contracts – till Apr 15. Such delays in order placing jeopardize not only deadlines but scope of executed works too.

Military Industrial Commission decided to complete placing of State Defense Order till the end of May, improve organizational procedures to place defense orders of further years in time, and increase personal responsibility for realization of Russian defense strategy.

Federal Law on State Defense Order provides deliveries of military production for federal needs in order to maintain proper level of Russia's defense capacity and security, i.e. weapons, ammunition, military equipment, component parts and materials. Additionally, some works, services, and military-oriented export/import deliveries can be performed in the framework of State Defense Order as well.

Recall that vice premier Sergei Ivanov delivering a report to the parliament on May 13 said Russian State Defense Order 2010 had been 94% completed. Ivanov stated on May 19 that the situation around State Defense Order 2011 had not seen radical improvements. Heads of JSC Izhmash and JSC NII Elektrotehniki V. Gorodetsky and A. Hohlovich lost their jobs. Director General and Chief Designer of Satellite Information Systems N. Testoyedov and Director General of NPO Mashinostroyenia A. Leonov were reprimanded.

Earlier on, three top-ranking military officials – General Major N. Vaganov, Colonel I. Krylov, and Vice Admiral N. Borisov – were released from office. Dismissal of the latter officer seems associated with failures in Mistral negotiations.

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