Russia revolutionises its jet industry

By Duncan Bartlett
Business reporter, BBC News, Moscow

Russia was a leader in fighter jets, but its technology is ageing

Russia is hoping to make a giant come-back in civil and military aviation.

It has pledged to spend billions of dollars on boosting its defence industry, especially the air force.

The goal is to build nearly 6,000 new military and civilian aircraft, and to win 15% of the global aviation market.

Russia has set up a new government-controlled company to oversee the process, the United Aircraft Corporation.

But there's a long way to go, as Russia's aircraft industry has been in the doldrums since the collapse of the Soviet Union in the early 1990s.

New orders

President Vladimir Putin recently described Russia's aviation and space industry as "the pride of our country".

Can you tell me which country is not re-arming now? Oleg Federov, Sukhoi commercial director View from the stock exchange Russian inflation bites Gazprom flexes its muscles

His government is in the process of reorganising much of the industry, which used to be made up of many separate firms such as the commercial aircraft maker Tupolev, Sukhoi and Mikoyan-Gurevich, which made Russia's famous fighter jets.

Now they are all part of the new state-controlled United Aircraft Corporation.

And that's a good thing, according to Sukhoi's commercial director, Oleg Federov.

"We've already received new orders for military fighters and for our civil products, and we are overloaded until 2015," he says.

"It's good for jobs, it's good for our workshops, it's good for the future."

Old planes

Mr Federov's company may be busy, but there remains a lot of catching up to do.

Russia has money and the government is ready to invest because it expects a return on that investment Oleg Pantaleev, aviation expert

Oleg Pantaleev, one of Russia's leading aviation experts and the editor of the website Aviaport, admits that large parts of the industry remain out-dated and inefficient.

"The problem is that there are so many old models created in the 1980s and 1990s," he says.

"They are not comparable with Western aircraft because they use a lot more fuel. On the other hand, they are cheaper - maybe 20% or 30% cheaper than the Western planes."

Mr Pantaleev believes that ultimately the United Aircraft Corporation will be successful, but not within the tight deadlines that the government has set the company.

"Russia has money and the government is ready to invest because it expects a return on that investment," he says.

New weapons

Critics have regarded Russia's new arms build up with suspicion, but the Kremlin's supporters insist it's not a threat.

Critics say Russia's rush to re-arm is a reminder of previous times

"Why shouldn't Russia build up its defence if everybody else does?," says professor Alexei Pushkov, a political commentator and the presenter of a well-known Russian current affairs television programme, Post Scriptum.

Mr Pushkov points to the US military budget, which dwarfs that of Russia.

"Everybody in the West talks about Russia re-arming itself and are hardly noticing what's going on on the other side of the ocean," he says.

"Russia is a huge country, it has to defend its borders. We have a border of 4,500km with China, so Russia has to build up its military. This right should be recognised."

'Not enemies'

President Putin recently warned that Nato and the West were provoking Russia into a new arms race.

Russia hopes to build new aircraft which could rival the likes of Boeing

So, is that a sign that the chilly relations with the West are turning into a new Cold War?

Not according to Sukhoi's Mr Federov.

"Russia and the US are not enemies, we have normal relations," he says.

"Can you tell me which country is not re-arming now? I think it's not just a question of Russia, or the US, or Great Britain. The government of each country is responsible for updating and providing new technology within the military."

President Putin wants the United Aircraft Corporation to become what he calls "a national champion", a major company which will develop into an important international player.

But a good deal more hard work and investment are required before it can begin to be taken seriously as a rival to European and American companies such as Airbus and Boeing.