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RUSSIAN ARMS EXPORTERS ESTABLISH RECORD

RIA Novosti

MOSCOW, February 2. (RIA Novosti)-Russia's defense industry established a post-Soviet record for arms exports last year: the revenues reached $6 billion (as against $5.568 billion in 2003), Vedomosti reports.
The director of the Federal Service for Military and Technical Cooperation, Mikhail Dmitriyev, told the president about the defense industry's success during a Tuesday meeting. According to Mr. Dmitriyev, Rosoboronexport earned $5.1 billion in 2004. Companies that hold independent export licenses for ready-to-use military equipment and spare parts made another $450 million.
The defense industry's high revenues might make Russia the second largest arms exporters after the United States, comments David Mulholland from Jane's Defence Weekly.
However, this record was ensured primarily by the increased exports of spare parts and post-sale services, which will not be enough to maintain the annual average of $5 billion for exports in the near future, believes an expert from the Center for Analysis of Strategies and Technologies, Konstantin Makiyenko.
In the next two to three years, the volume of arms exports will not decrease, adds Marat Kenzhetaev from the Center for Arms Control, Energy and Environmental Studies. Russian companies have future contracts for arms deliveries worth about $14-15 billion. Later, though, Russian manufacturers will have to search for new markets. Prospective buyers include countries in North Africa and Middle East, while China and India might be interested in strategic weapons systems.
Russia exports primarily aircraft and aircraft-related equipment, which accounted for 60% of the overseas deliveries in 2004. The share of the procurement of combat ships and air defense systems was about 20%.
Last year, Russia concluded a large contract with China on the delivery of S-300 air defense complexes worth almost $1 billion. In the near future, Russia plans to sell similar systems to Vietnam and to conclude contracts on the delivery of Tor and Pantsyr air defense complexes to India and Middle East countries.