Russia
Russia has no defense industry policy -- expert
Konstantin Makiyenko, the deputy director of the Center for Analysis of Strategies and Technologies, said in an interview with Vremya Novostei that the Defense Ministry was unable to set the priorities of military- technological policy and finance them properly. Of this year's $6-billion state defense order, about half is spent on equipping the nuclear deterrence forces, he said. Another $3 billion is scattered among numerous R&D projects, the majority of which never reach the stage of production samples. In his opinion, this is why it is hard to say where the money goes.
Makiyenko said the leading companies of the defense-industry complex -mainly major aircraft-building corporations and related instrument-making companies - were still mostly working for export. He said 90% of their output went overseas.
If the defense order is inadequately financed, defense-industry complex companies will accelerate their withdrawal from military production, the expert told the paper. The owners of a northern shipbuilding holding, Baltiysky Zavod, have already said they intend to work on civilian orders only. Aircraft manufacturers are planning to raise their share of civilian output to 50%.
Makiyenko said that in such conditions only those companies capable of implementing joint projects would survive and become leaders. "All new projects must be also oriented to the world market and global competition," he said, before adding that too many companies were vying for competition in the relatively small Russian economy.
In his opinion, one or two companies with a capitalization of up to $3 billion and sales of at least $1.5 billion should be set up in each sector of the defense-industry complex.

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