Russia to speed up establishment of holding companies in defense industry in 2002

MOSCOW. Jan 11 (Interfax-AVN) - An active stage in establishment of integrated holding companies in the Russian defense industry will be launched this year. All defense agencies have drafted reform plans, the Vek weekly reported on Friday.

Director General of the Russian Control Systems Agency Vladimir Simonov said at a round-table discussion devoted to the defense industry restructuring that his agency had already established 10 large integrated structures uniting about 200 enterprises. An analysis of their activities will serve as a foundation for establishment of 17 more holding companies within the agency.

Director General of the Russian Conventional Arms Agency Alexander Nozdrachev said that a federal purpose-oriented program entitled "Restructuring and Development of the Defense Industry (2002-2006)" envisaged establishment of nine large-scale research and production corporations within his agency. Each company is to manage its own sphere of activity, among them optics, precision- guided weapons, armored vehicles, artillery, missile systems, small arms and cartridges.

"The forthcoming establishment of holding companies is motivated by market requirements and the true state of the Russian defense industry in the beginning of the 21st century," Director General of the Russian Shipbuilding Agency Vladimir Pospelov said. The companies are to bring together the research, technological and human potential of the industry to guarantee implementation of the armament program, output of competitive products and development of new technologies, he stressed.

For instance, the Naval Systems company will comprise research organizations and enterprises that have been designing naval radars and ship-borne artillery control systems for a long time, Pospelov added.

Establishment of holding companies is underway in the Russian Ammunition Agency and Russian Aviation and Space Agency too. The Sukhoi joint-stock holding company is to be among the first operational integrated structures. A decree on the company's formation has recently been signed by President Vladimir Putin.

Director General of the Sukhoi aircraft corporation Mikhail Pospelov said establishment of the Sukhoi holding company envisaged privatization of the Komsomolsk-on-Amur and Novosibirsk aircraft production associations. 74.5 percent of shares in the two associations will be included in the chartered capital of the Sukhoi holding company. The Sukhoi corporation already holds 14 percent of shares in the Irkutsk aircraft production association, 38 percent of shares in the Taganrog aircraft research and production corporation and the controlling interest in the Sukhoi design bureau.

The state will own 100 percent of shares in the Komsomolsk- on-Amur and Novosibirsk associations, but 25.5 percent of shares in each enterprise will be transferred to the Russian Federal Property Fund.

The Sukhoi holding company must be a tool that will be used to consolidate resources for development of promising planes, Pogosyan said. Among these planes is the fifth-generation multifunctional fighter.