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13 Aug, 2007 04:19

Russian helicopter makers gain state support

Russia's President has met top manufacturers to create national engine and helicopter building corporations, as the government battles to revive the country's machine industry.

Vladimir Putin visited Russia's top engine maker Klimov. It comes in the wake of new helicopter, aircraft and shipbuilding holdings.

President Putin has set a strategic target of bringing the Russian machine-making industry back to life within 5 years. The creation of the United Aircraft Building Corporation last year is already paying dividends with the Superjet 100, considered Russia's first world-class civil aircraft of the century.

Now Putin has set his sights on the engines which power these crafts.

“Our engines are behind in terms of resources, fuel efficiency, noise level and environmental standards. They are blocking the development of Russia's aviation industry. Today I have ordered the creation of the United Engine-Building Corporation to address this,” stated Mr Putin.

The corporation will pool the resources of leading national manufacturers to create fifth-generation aircraft engines.  These will compete worldwide with the likes of General Electric and Rolls Royce.

The President then turned his sights on helicopter construction.

“Helicopters are absolutely crucial for Russia considering its geographic and climatic conditions. I have ordered the creation of a unified helicopter research and production base, to increase volumes and financial capacity,” added Mr Putin.

But analysts say the new corporations can only succeed if they keep their market structure, and not succumb to government bureaucracy.

“What we fear above all is a return to an unprofitable, Soviet structure. These new state-owned corporations must remain flexible, market-oriented and not overly dominated by military demands,” commented Dr. Maria Alekseenkova, the Vice-President of Research, renaissance Capital.

Later this year the United Shipbuilding Corporation will bring together Western Northern and Far Eastern Shipyards, investing $6 BLN over 8 years in their modernization.

The government sees the re-launch of its machine-building industry as essential to power the next generation of economic development.