FEDERAL SPACE AGENCY EVALUATED THE SHORTAGE OF UKRAINE

Ivan Safronov, Sergei Goryashko

IMPLEMENTATION OF A PLAN FOR SUBSTITUTION OF IMPORT FROM UKRAINE WILL COST THE SPACE INDUSTRY OF RUSSIA 33 BILLION RUBLES

The Federal Space Agency calculated the amount of money that would enable Russia to compensate for negative consequences from termination of cooperation with enterprises of the Ukrainian military industrial complex. Localization of production on the territory of the country will require about 33 billion rubles in the period until 2018 including more than 3.5 billion rubles already this year. Before allocation of additional money from the federal budget the agency is ready to save money on less important programs for the sake of fulfillment of the import-substitution plan.

A special working group created according to resolution of Director of the Federal Space Agency prepared proposals about composition and volumes of financing of the work necessary for compensation for negative consequences of termination of cooperation with foreign suppliers. This is said in a letter of Mikhail Khailov, head of the department of automatic space systems, to senior deputy director of the agency Alexander Ivanov. First of all, the matter is about cooperation with enterprises of the Ukrainian military industrial complex. To get rid of direct dependence and to transit to use of domestic components and raw materials and to relocate production of components, assemblies and systems from Ukraine to Russia the Federal Space Agency plans to receive about 33 billion rubles in the period from 2014 until 2018 including 3.54 billion rubles already this year.

The agency proposes allocation of this amount in the framework of both already working federal and targeted programs and programs planned for fulfillment.

For instance, the Federal Space Agency plans to take 2.285 billion rubles (525 million rubles in 2014) from the federal space program for the period between 2006 and 2015, 23.229 billion rubles (3.015 billion rubles in 2014) from the federal targeted program "Development of military industrial complex of Russia between 2011 and 2020" and 7.476 billion rubles from the federal targeted program "Development, restoration and organization of production of strategic deficit and import substituting materials and small-tonnage chemicals for armament, military and special hardware."

On June 16, President of Ukraine Petr Poroshenko prohibited any cooperation with Russia in the military industrial complex. Until that moment Ukrainian authorities announced stopping of cooperation in the military field in production and supply of armament to Russia but the embargo was not applicable to joint production of dual-purpose components. Reaction on the part of Russia appeared on the same day: Deputy Prime Minister Dmitry Rogozin announced that import-substitution plan was already prepared. In the framework of the visit of Vladimir Putin to Samara-based rocket space center Progress yesterday the Deputy Prime Minister announced that the plan was already approved by the government and would be presented to the President soon.

In his letter Khailov says that in the framework of the federal space program for the period between 2006 and 2015 for taking of import substitution measures it s planned to fulfill four research and designing programs and perform one purchase according to the topics of the department of manned programs (overall volume of 843.7 million rubles), three research and designing programs in the interests of the department of delivery vehicles and ground space infrastructure (81.8 million rubles), as well as three research and development programs for the department of automatic space systems (approximately 1.36 billion rubles). According to him, the federal targeted program "Development of the military industrial complex of Russia for the period between 2011 and 2020" includes one research and development program and one investment project according to the topic of the department of delivery vehicles and ground space infrastructure (1.4 billion rubles), two research and designing programs and one investment project in the interests of the department of combat missile technologies (1.389 billion rubles), as well as 23 research and designing programs according to the topics of the department of automatic spacecraft and systems (20.449 billion rubles). The planned federal targeted program "Development, restoration and organization of production of strategic deficit and import substituting materials and small-tonnage chemicals for armament, military and special hardware for the period between 2016 and 2025" includes 16 research and development programs in the interests of the department of combat missile technology (7.476 billion rubles).

Product range of Ukrainian products is fairly broad. The documents that accompany the letter of Khailov contain 56 proposals about three programs that deal with development of microcircuits, microprocessors, carbon fibers, stabilizers of voltage and special chemicals that are used practically in all spacecraft (including the military ones) and rocket systems.

Along with this, Khailov requests "taking into account of a long and complicated procedure of reception of additional funds from the federal budget." To ensure fulfillment of the import-substitution plan, he proposes conduction of some research programs in the framework of the federal space program until 2015 "on account of saving and re-distribution of money allocated to less important projects." The precise amount is not indicated in the letter but a top-ranking source in the Federal Space Agency says that this will require about 1.36 billion rubles. On account of giving up of less important programs the agency proposes conduction of research and development programs in the interests of the department of combat missile technology and department of delivery vehicles and ground space infrastructure. The source adds, "In both cases it will be necessary to correct the state defense order of this year, as well as to submit our proposals for its formation in 2015."

The Federal Space Agency does not comment on the agency’s import-substitution plans officially.

Source: Kommersant, July 22, 2014, pp. 1, 3

 

PRESIDENT IS READY TO HELP AVIAKOR TO SURVIVE THROUGH TERMINATION OF RELATIONS WITH UKRAINE
Yegor Sozaev-Guryev

RUSSIAN-UKRAINIAN PROJECT FOR PRODUCTION OF REGIONAL PASSENGER AIRPLANE AN-140 IS ON THE BRINK OF STOPPING

At a meeting in Samara Region President and the government discussed possibilities for provision of assistance to one of the biggest aircraft-building enterprises Aviakor – Aviation Plant. Aviakor is bearing economic losses due to stopping of the joint project with Ukraine for production of turboprop airplane An-140. The airplane may be replaced with IL-114.

General Director of Aviakor Alexei Gusev reported to President Vladimir Putin:

– We do not transfer money because we are afraid that products will not be made. Relations with the plants are normal but these are not they who influence the shipment. This is a loss for us. We consider two options. This is IL-114 that has formerly been produced in Uzbekistan for security agencies and afterwards for the civil ones. Second, this is repair of the airplanes operated in Russia, which will enable the air carriers not to move airplanes abroad. It is also possible to use our runway for small air companies.

The President asked:

– What kind of support? Do you need an order?

He remarked that engine should be Russian.

In the course of discussion it was decided that a part of airplanes from Uzbekistan would fly to the end and afterwards production would be relocated to Russia fully. At the first stage, the project is estimated at 12 billion rubles.

Putin said:

– Amount of 12 billion rubles is not small but it is normal for such project.

Alexei Gusev reported that during cooperation with Ukrainians 3 billion rubles was spent first. Putin looked at Minister of Industry and Trade Denis Manturov and Deputy Prime Minister Dmitry Rogozin.

Manturov remarked cautiously:

– I would be afraid to confirm this figure. Data came yesterday afternoon. It s necessary to evaluate them.

Rogozin said:

– We considered this airplane. We do not have such type. Alternatives are ATR and Canadian Bombardier. But this is doubtful now. The idea is interesting, we will check and report.

Earlier, Rogozin already spoke positively about IL-114.

In the Soviet time and at the beginning of the 1990s Samara Region was the economic leader of the Volga Region but by now these positions were lost. According to acting governor Nikolai Merkushin, fewer investments come to the region and the region participates in federal programs less.

Samara authorities wish to create their techno polis for an aerospace center and they need assistance of the federal government for this purpose.

Source: Izvestia (Moscow issue), July 22, 2014, p. 2

 

BELARUS TO REPLACE UKRAINE IN THE RUSSIAN DEFENSE INDUSTRY
Anastasia Kashevarova, Petr Kozlov

Deputy Prime Minister Dmitry Rogozin declared that in the coming days a plan for import substitution in the field of conventional arms will be presented to the head of state. Reportedly, on July 28, a meeting on import substitution in the military-industrial complex (MIC) will be held in the Kremlin, at which a government report will be presented to Vladimir Putin. As we found out, it is expected that Belarusian counterparts will replace production of the defense enterprises of Ukraine; partners from Kazakhstan are also likely to participate.

(…)

Speaking at the White House meeting with Russian trade representative on July 23, Prime Minister Dmitry Medvedev expressed concern that the developments in Ukraine would certainly affect the Russian defense industry, because Ukrainian enterprises produced components for weapons and military equipment in Russia.

(…)

Earlier Vladimir Putin also said that Russia should be ready to replace Ukrainian goods and adjust its state defense order.

A senior source in the Presidential Administration says that this issue has been worked out. It will require the establishment of new production facilities in Russia. Additionally, Belarus and Kazakhstan capacities will be attracted.

(…)

The Ukrainian defense was once part of the Soviet complex; after the collapse of the USSR, our collaboration continued, as it was cheaper to buy products there, than to deploy a duplicating production in this country. The Russian MIC purchased mainly various kinds of blocks, components and accessories at Ukrainian enterprises, according to Editor-in-Chief of the "National Defense" magazine Igor Korotchenko.

Korotchenko insists: "Within the coming two and a half years, Russia will be able to launch the production of what we imported from Ukraine in its territory. It will approximately require an additional of RUB 20-40 billion. But instead, we will gain technological invulnerability".

Parts and accessories for "Voevoda" intercontinental ballistic missiles, with which Russia’s strategic forces (RVSN) are armed, are an exception from this rule. But they were created during the Soviet period; the term of their operation is nearing completion. Korotchenko notes that, to replace them, "Yars" RS-24 new solid fuel ballistic missiles are already coming for combat duty.

Separately, there is a question about aircraft engines – Russia bought them for its helicopters and airplanes. So far supplies have not stopped, but apparently it can happen in the near future.

(…)

According to Korotchenko, in the near future new capacities on the basis of United Engine Corporation will be created to solve this problem.

The replacement for helicopter engines assembled in Ukraine looks most problematic. It is unlikely that Russian industry will be able to compensate for this loss within two and a half years, of which the President mentioned. Apparently, it will take up to 4-5 years, according to officer of the Center for Analysis of Strategies and Technologies Vasily Kashin. We can face similar difficulties with marine engines, he adds.

(…)

As for relatively small parts, such as components, devices and other things, they can be compensated for with Russian products in a period of several months to a year, the expert added.

Source: Izvestia (Moscow), N136, 25.07.2014, p. 1

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