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Together with Deputy Prime Minister – Presidential Plenipotentiary Envoy to the Far Eastern Federal District Yury Trutnev and Head of the Republic Alexei Tsydenov, Vladimir Putin examined information stands about the history of the plant. The plant’s managing director, Alexei Kozlov, led the tour.

The President was shown helicopter units and airframes for new models: a modification of the civilian Mi-171AZ helicopter and a modification of the Ka-226 – Ka-226.54 helicopter. The President also visited the final assembly shop and talked to the plant workers.

Vladimir Putin was also shown samples of finished products the plant manufactures, while in the training centre, he admired a Mi-171A2 helicopter simulator. Apart from aircraft manufacturing, the plant provides aircraft service support and upgrading and also trains aircrews and maintenance personnel.

The Ulan-Ude Aviation Plant (U-UAZ) is a leading Russian helicopter manufacturer and a key enterprise in the capital of Buryatia. It is a subsidiary of Russian Helicopters.

The company was founded in 1939, and today it has an integrated technological complex for manufacturing both helicopters and aircraft.

* * *

Conversation with Ulan-Ude Aviation Plant workers

President of Russia Vladimir Putin: Good afternoon.

I am happy to see you and take a look at your wonderful enterprise.

Denis Filimonov: Good evening, Mr President.

Can you please tell us, despite the relatively long flight and the harshness of the Siberian climate, what is your first impression of our enterprise?

Vladimir Putin: Great.

First, it has very good traditions, as you know, it was founded in 1939. They used to build all kinds of aviation equipment here: both helicopters and airplanes. This means that the skills are high, and the traditions are remarkable.

But your enterprise is developing, it is advanced, and it makes great machines that are in demand on the global markets, as you know, and in Russia, both in civilian aviation and for the Defence Ministry. And the line of products is expanding, which is excellent. New materials, new advanced engines, new avionics – that’s just great.

A good school, an excellent enterprise. I want to congratulate you for being lucky to work here. No wonder as this is the flagship company of the domestic helicopter industry, so it’s great! Congratulations!

Remark: Thank you.

Maxim Shatov: Mr President, can I ask a question?

Vladimir Putin: Please.

Maxim Shatov: Good afternoon. My name is Maxim Shatov, I am a design engineer.

The question I want to ask perhaps concerns everyone, because the situation in the world cannot help but concern people.

Vladimir Putin: Yes.

Maxim Shatov: We believe that all the decisions made in the capital were well-considered and calculated. So please tell us, how can we, ordinary citizens, aircraft plant workers, help our country win and bring peace to every home?

Vladimir Putin: You know, to try to answer your question, I will still have to start with the reasons for what is happening. I will try not to go into too much history here, but still, without this, a complete answer will not be possible.

Indeed, all the problems began after the collapse of the Soviet Union. Why? Because a world order had been created – the world order we continue to live in was established after WWII by the countries that won WWII, primarily the United States and the Soviet Union. They built their respective zones of influence, and honestly, they never interfered in each other’s spaces too much. They did have problems, sometimes as big as the Caribbean crisis, and yet, they coexisted.

After the collapse of the Soviet Union, this bipolar world system began to fall apart, right? And frankly, for people of my generation – I know there are people my age in this room, or maybe a little younger – it seemed to us then, and it seemed to me too that, well, the Soviet Union collapsed, whether we missed it or not, but any reasons for confrontation between the former Soviet Union (and the new Russia) with the Western world ended, too, that we had no ideological grounds for confrontation. It seemed things would be bright and clear from then on.

It turned out that we were wrong. It turned out that, as I said earlier, our so-called partners’ geopolitical interests were far more important to them than any ideological contradictions with the former Soviet Union. And immediately – you are perfectly aware of this – they started putting pressure on us, rocking Russia’s boat. They tried to create a “fifth column” in Russia to destabilise internal politics and sent hordes of international terrorists to attack us; these groups began to operate in various regions of the country, including, and above all, in the North Caucasus. We have seen it all. Terrorist attacks in Russia happened before our eyes. And they also began to be more active along the perimeter [of our borders].

But Ukraine was given a special role. Why? For historical reasons. I will not go into detail why it happened this way, but nationalism has been growing fast there since the 19^th century, fuelled from the western side: first by Poland, later by Austria-Hungary, and so on. Shortly before WWI, they began tearing Russia apart, trying to weaken it. These roots ran fairly deep.

After World War II, those who collaborated with Hitler and the Nazis fled to Europe, and most Ukrainians fled to the United States and Canada. It was sort of an anti-Russia base. They started feeding and expanding it in order to gradually turn Ukraine into an anti-Russia. For our part, we have been patiently trying for decades to establish proper relations with the modern Ukrainian state.

The situation changed drastically in 2014, when the coup d’état took place at the behest of the West. We relied not only on the Russian-speaking people there – that whole country is Russian-speaking, in fact – we relied on the people who considered themselves part of the greater Russian world, our culture, language environment and our common traditions. We relied on those people. Of course, they lived and continue to live compactly in southeastern Ukraine.

The year 2014 and onwards saw the physical extermination of everyone in Ukraine who was in favour of normal relations with Russia. Public figures and journalists were killed in the streets. Let's think back to what happened at the House of Trade Unions in Odessa, where people were burned alive. Then, came the issue of Crimea, and we could not help but support its people. Then, came the issue of Donbass. We have been trying for eight years to talk our so-called partners into resolving the Donbass issue peacefully. Now it turns out they were giving us the run around, deceiving us. They are saying this publicly without mincing the words. All of that led to where we are today.

You know, for me to answer your question, here is what I would like to say in this regard and to make clear why I went deep into history. If for our so-called Western partners, our today's adversary – we can be direct about this now – the point is about improving their geopolitical position, for us, I mean the events of the last eight to ten years, everything that is happening is not just about improving our geopolitical position.

For us, this is primarily about fighting for our people who live in these territories. You see, we are a multi-ethnic country; this is the Russian world after all. If you talk with the people who come from there – I have met some of them – they are no different from us, not a bit. They are the same as us. They are one of us, part of our nation. How can we leave them behind? This is my first point.

Second, for us this is not a fight to achieve some geopolitical status. For us, it is about a fight for the survival of Russian statehood, because our adversary or, as I referred to them previously, our partners, have one goal – and we know this from previous decades – which is to destabilise us and pull our country apart. That’s the point. So, for us, this is not a geopolitical goal, but a matter of survival of Russian statehood and the creation of proper conditions for further development of our country and our children. This is what is at stake for us.

In this regard – I am about to give a straight answer to your question – I would say that in order for us to bring peace and stability closer, we need to consolidate as a society and get our act together. To reiterate, only when the adversary sees that our society is strong, composed and consolidated, then, without a doubt, what we are striving for and what you mentioned, success and victory, will come to pass in each of the areas that we are working in today. This is my first point.

As regards your team, we started out with this. Yours is a special company that has been manufacturing non-defence and defence products since 1939. So, your role in ensuring victory is special and very important.

I look forward to our joint and effective work.

Maxim Shatov: Thank you very much.

Remark: We will not fail you.

Vladimir Putin: I have no doubt about that. Thank you.

Yulia Plastinina: I would like to ask the following question.

I am Yulia Plastinina, deputy head of the Orgsteklo specialty centre.

We were on edge throughout 2022, fearing that the Russian economy would break down and collapse. We were very worried indeed. But today we see that it is actively…

Vladimir Putin: Believe me, I was worried as well.

Yulia Plastinina: We can see today that it is adapting to the current conditions, we are monitoring the GDP.

So, I would like to ask what you think about the economic situation in Russia this year?

Vladimir Putin: It is an extremely important question, because everything depends on it, including the defence capability of our country.

It is clear that Russia completed an extremely important stage in its development last year. This may be our most important achievement of 2022. What does this mean? We have increased our economic sovereignty several times over. What did our enemy hope to see? They hoped that we would collapse within two or three weeks, or a month at the most. That is what they hoped for. They hoped that our enterprises would stop working after our partners refused to cooperate with us in the economic sphere, that our financial system would crumble, and tens of thousands of people would become jobless and would take to the streets to protest, that Russia would be unbalanced inside and would collapse. That is what they wanted. It did not happen.

It turned out, unexpectedly for many of us, let alone the Western countries, that the fundamental pillars of Russia’s stability are much stronger than many people thought.

As I have said many times, people live their own lives and few of them read economic forecasts online, but it is said on television from time to time that they forecast our GDP to plummet by 20 percent or more. This did not happen.

You have mentioned the GDP, which is everything a country produces in a year, if we take year-end figures. We were talking about Ukraine just now, where the GDP has plunged by 40 percent. This is official information. I think that the actual figure is larger.

Our GDP has declined, but only by 2.1 percent rather than the 20 percent they forecast. Of course, it would be better if it did not fall at all, but the current trend is on the rise. Our GDP has been growing for the past seven months, seven months in a row. The decline was only considerable in the second quarter of 2022, after which we reported growth. How long did it last? Approximately seven months. This is my first point.

Another very important aspect is that our financial system has remained stable thanks to the determined actions of the Central Bank, the Government and our largest financial institutions. Yes, there was a certain disruption and decline but right now, we can confidently say that Russia’s financial system not only withstood the pressure but has become stronger, more independent, and is steadily developing using its own resources. It is a matter of principle, an absolutely crucial issue.

Sales on the domestic market are on the rise. Many production industries were oversized and oriented towards the external market. Some of those exports have decreased. But the domestic market is growing, as shown by objective data from points of sale.

Why? First of all, we have to admit and say frankly that there has been a slight decrease in real wages and real incomes, by one and two percent, respectively. However, there is an upward trend. Yours is a special case. I understand that this company offers wages that are above the average in the region. But overall, we noted a slight growth across the country, albeit small.

What are the consequences? Domestic sales are on the rise, meaning that the products our companies make are in demand. Trade is growing, which is a very good indicator. What helps? First of all, the unemployment rate is at a historic low. Even before the pandemic, the unemployment rate was 4.7 percent while the latest data from the labour market show 3.6 percent. I think nobody even expected that. Everybody expected that production facilities would shut down and yet they keep operating and unemployment is down to 3.6 percent. Incomes are growing slightly. As a result, domestic trade is growing as well, which is a very good outcome.

These are the main factors.

What is also curious, and I discussed it with my colleagues the other day, is that, it was clear to us but nevertheless, when Western companies were leaving, they thought everything would collapse immediately but it did not happen. Participants in the economic activity in Russia have grown and become stronger; they developed their own culture and established their own links around the world. They easily replaced those who left and, where it was reasonable and affordable (and we helped them), started buying out those companies, along with qualified personnel, streamlined cooperation chains that continue to work one way or another, as entire clusters. Firstly, this was an easy takeover and secondly, the vacant niches on the market were immediately filled with their own goods. Production in the segment of small and medium-sized business is growing.

Yes, we have to admit that our ill-wishers hoped that they would create problems for us in the medium term. This danger does exist, and we are aware of it. Why? Our long-term cycle enterprises need up-to-date equipment and up-to-date designs, of course.

But I think that everything will be fine there, because we are implementing new support instruments for innovative production sectors. They include industrial mortgages, preferential treatment and the creation of certain industrial clusters. We must by all means maintain internal competition so as not to remain in our comfort zones and so that consumers can feel that there is competition, which is very important for progress.

Taken together, this allows us to conclude that, despite certain outlays, last year benefitted us, as I see it, considering that we have become much more sovereign and independent in the economy and the financial sphere.

Yulia Plastinina: As the saying goes, what does not kill you, makes you stronger.

Vladimir Putin: That is about right.

Yulia Plastinina: Thank you.

Sergei Savchenkov: May I ask a question?

Vladimir Putin: Yes, please.

Sergei Savchenkov: I am Sergei Savchenkov, team master at the machine assembly plant.

Some time ago, you spoke about approving conscription deferment for the young people who work at defence enterprises. Can this issue be resolved soon?

Vladimir Putin: We need to find a balance, because defence enterprises work in the interests of the Defence Ministry and the defence sector as a whole. Of course, we must establish a balance between production and the interests of the Defence Ministry.

We understand, and we know – I am sure you know this as well – that today many enterprises are working three shifts a day and that we are short of professionals, especially highly qualified professionals.

We must work on several aspects and move in several directions.

First, wages must be attractive at such enterprises. I have talked with a young woman just now, and I asked her how much she earned. She replied that her pay was 90,000 rubles. She works in a nearby shop. However, I know that the average pay at the enterprise is 73,000 rubles. And the governor has told me that the average for the region is around 52,000 rubles.

Overall, we must keep working on this, keep raising wages.

Second, we must settle housing problems.

Of course, we must identify the areas that are most critical and most important for maintaining and developing workforce potential. I want to inform you that the Ministry of Industry and Trade has developed a list of specialisations and professions that are in high demand, and submitted it to the Ministry of Defence. They maintain a dialogue to finalise their decision.

Sergei Savchenkov: Will the Government take any additional measures? Because, I believe, for young people industries like oil and gas, and IT are more prestigious while machine engineering and engineering in general are less so.

Vladimir Putin: You know, things are changing so fast. It depends on personality, the current mood, what a person likes and enjoys doing most, where they can express themselves and self-actualise in the best sense of this word. It appears to me that to a great extent, the state also plays a role. Such aspects as wages, prospects and prestige, social recognition of one's occupation are important. So, it is a complex matter.

As for workforce training, there are entire specialisation programmes available. Of course, we will continue to work on this.

Sergei Savchenkov: There is a shortage.

Vladimir Putin: Yes, I know there is, and at this facility as well. And thank God that is the case. On the one hand, it is a problem but on the other hand, it is good because people with high qualifications or people willing to improve their skills will come to work here, including from the European part of the country.

Sergei Savchenkov: It is this shortage that prevents us from fulfilling the state defence order.

Vladimir Putin: True.

You know, when there are no obstacles, one might as well lie down and go to sleep. When everything is fine, one might as well snore away. And when something stands in the way, it is an opportunity to work on yourself to solve these problems.

Sergei Savchenkov: I see, thank you.

Tatyana Sabayeva: Tatyana Sabayeva, Chair of the Primary Trade Union.

Mr President, to follow up on what was said earlier, our production programme grows every year, which is good news. One might wonder what there is to be happy about. But we lived through the hardships of the 1990s, when there was unemployment, people worked two days and food was scarce.

Vladimir Putin: Now everything is fine.

Tatyana Sabayeva: I know what it was like.

Vladimir Putin: Moreover, one of your colleagues just asked about the economy. Last year, and we are deeply grateful to our agricultural producers, more than 155 million tonnes of grain were harvested. The Minister of Agriculture reported to me the other day. It was 153 or 155 million tonnes. This is a record figure in the entire modern history of Russia. Even during the Soviet times, if we speak about the RSFSR, we could not boast such high results.

Sorry.

Tatyana Sabayeva: This is why we are happy that our production plans are growing. We are very proud of our plant. We are proud of our products because they are high-quality goods. I am not boasting.

Vladimir Putin: I know.

Tatyana Sabayeva: It shows how well our workers can assemble our products.

But we also understand that to implement our plans on schedule and with high quality we need good, highly skilled professionals. This is an integral part of the issue.

Vladimir Putin: Quite so.

Tatyana Sabayeva: But right now, there is a shortage of such professionals at the plant, just as everywhere else.

We believe that we should focus on construction for our plant to continue growing. Not that we should be directly involved, but we need buildings a short distance from the plant, even if it is leased property.

Vladimir Putin: You mean housing?

Tatyana Sabayeva: Yes, housing, including housing which our workers, our young families would be able to buy, projects with a good modern infrastructure so that they, our young people would not want to move from the republic. We are aware of the current situation, and, regrettably, we are seriously concerned about it.

Therefore, I want to ask if there are federal construction programmes for building such housing, which we would be happy to make use of.

Vladimir Putin: We were talking just now about the drain of professionals, and the Governor has just spoken about it. This especially concerns young people. I was surprised to learn that young people go to the European part of the country to receive an education, return here after graduation, and move away some time later.

To stop this from happening, we must above all create interesting and high-quality jobs with a potential, the types of activity that will be attractive to our people. Your enterprise can offer such activities, of course. But using only this method is not enough, there must be many more attractions.

As for having people stay, there is an elementary bureaucratic method…

Tatyana Sabayeva: Retaining?

Vladimir Putin: To retain people, we must build housing, of course, which is one of the main tasks we must address.

We have come here with our colleagues to discuss the development of the main cities in our Far East. One such programme is being implemented in Kamchatka, and we are considering five more cities, including Ulan Ude.

Tatyana Sabayeva: This is wonderful.

Vladimir Putin: This involves a package of development methods, not just giving flats to people…

One of the methods is housing lease. Under this programme, part of the funds will be allocated for leasing housing for your enterprise. But housing, lease housing or any other form of ownership, is not enough. We must develop the region as a whole. We must develop the social sphere, kindergartens, nurseries, schools, sports and culture facilities. All this must be developed as a package. This is the goal of the programme, which we will discuss now and which we will implement, because it is ready, on the whole.

Regarding Ulan Ude, 150 billion rubles will be allocated additionally for its development in the next few years, until 2030.

Tatyana Sabayeva: Thank you.

Vladimir Putin: You are welcome.

Vladimir Gundasambayev: I also have a question about our city. It is a well-known fact that our city is suffocating because of smoke and gases emitted by boiler facilities.

Vladimir Putin: Coal and wood, yes.

Vladimir Gundasambayev: Soot.

Vladimir Putin: I see.

Vladimir Gundasambayev: It is impossible to breathe.

There is a federal programme called Clean Air. Can we participate in this programme?

Vladimir Putin: The Clean Air programme was created for the 12 major metropolitan areas with the worst environmental conditions. Ulan-Ude is not included but the Government is working on expanding this programme to include other cities besides the 12 metropolitan areas. It was our initial plan. We will take the next step in the near future.

But as far as Ulan-Ude is concerned, we also spoke with the Governor and I know that there are local proposals and ideas such as transition to electric power as well as subsidies. It will cost about half a billion per year, or 500 million. But it appears to me, though this requires a feasibility study, that connecting facilities to the gas network would be most promising.

And if, as I find likely, we follow through on the construction of the gas transit system to export gas to China, with all components in place… Selling gas abroad at any cost is not important here. What is important is that to extend the gas pipelines to this region, we need to make sure it is economically beneficial. It would be a very expensive project if we simply build multiple pipelines at a cost of billions without receiving returns for decades, if ever.

On the contrary, if we have an export pipeline and decent export rates, this main pipeline would pass 200 km away from Ulan-Ude. Gazprom and its Chinese partners are currently mapping the route. With the distance reduced to only 200 km, it becomes more probable. When that is done, we will be able, in cooperation with Gazprom, local officials and the Government, to sit down and develop a unified gas supply project for the region.

I believe it is a goal we should strive for. Of course, it is feasible and important to subsidise electric heat generation, power and so forth. This is also possible but, as a rule, very expensive.

There are also alternative solid fuels which are less hazardous than coal.

Remark: There are options.

Vladimir Putin: Yes, absolutely. So, we will look into all these options.

Dorzho Bandeyev: Mr President, may I ask another question?

Vladimir Putin: Of course, you may.

Dorzho Bandeyev: My question is about gas infrastructure development in this republic. You said this could be done, but nothing has been done to solve the gas supply problem over the past 15 years.

We would like the Government to give us concrete instructions or take action, make decisions on gas infrastructure development in our region. There is a gas pipeline project, Power of Siberia 2. It cuts across the Irkutsk Region, overrunning only some remote areas in Buryatia, and proceeds direct to Mongolia.

Vladimir Putin: I have just spoken about this.

You see how the gas pipeline system took shape back in the USSR: the eastern regions were not developed in this regard, there were no gas transmission networks; everything was being developed in the European USSR.

Today, there is a pipeline heading for Vladivostok. So, first, a junction can and must be built. Second, Gazprom has an idea to link the European gas pipeline system and the Far Eastern gas pipeline system, given that Power of Siberia 2 is up and coming, making the development of a gas transmission system here an attractive proposition. This is so because the export prices are much higher than domestic prices and this enables Gazprom to cater to a considerable portion of the population. Russia’s current average gas infrastructure development rate is 73 percent or thereabouts.

But the eastern part of the country was not developed at all in the past, for historical reasons. I think, it is also clear why this was so: there are 12 million people living beyond the Ural Mountains and it is very difficult to lay a pipeline to each populated locality. This is the first point.

Second, we do have gas fields, but the problem is that nothing in the way of infrastructure has ever reached these parts. It is only now that we are beginning to gradually develop it.

As soon as the agreements with our Chinese friends take definitive shape, we will understand where the final routes will run. It is then that we will be able to plan gas infrastructure development in these regions on a broader scale. Apart from everything else, this will certainly give an impetus to the development of the engineering, iron-and-steel, and pipe-making industries, as well as the local economy as a whole, with new jobs and additional tax revenue for all levels of the tax system. Therefore, this is a very good project.

Of course, we should primarily think about ways of helping residents of this country to have a better and more comfortable life. This is something to be remembered under all circumstances.

Yes, please.

Natalya Frolova: I have a question.

Vladimir Putin: Please, go ahead.

Natalya Frolova: I am Natalya Frolova, chair of the Veterans’ Council.

Next year, our company will turn 85, which is a big date. In fact, from the day it was created, our company has been making defence products.

During the war, our grandfathers and great-grandfathers went to the frontline and women and children took their place at the machines. In 1942, our plant began to produce aircraft. Before that, it manufactured aircraft parts and components, but then…

Vladimir Putin: Semyon Lavochkin aircraft, I think.

Natalya Frolova: Lavochkin, correct. They began to manufacture aircraft.

Patriotism is not just a word to our factory workers. We have a museum at the plant, and our veterans’ council also has a museum of its own.

I am speaking not only on behalf of former workers of our plant, but also on behalf of all retired employees from our city. We would like to perpetuate the labour feat of the people of our city by conferring the title of the City of Labour Glory to Ulan-Ude. Is it possible?

Vladimir Putin: No question about it. There are certain procedures to follow, so there should not be any problem with that. All your bosses need to do is sign the documents on time.

Mr Tsydenov, did you hear that?

Head of the Republic of Buryatia Alexei Tsydenov: Yes, we will do that.

Natalya Frolova: Thank you.

Vladimir Putin: You should submit an application to the federal authorities. There is a procedure to follow. I do not think it will be a problem, particularly as you have been in business since 1939…

Natalya Frolova: It will be 85 years next year.

Vladimir Putin: The company did a lot to ensure Victory in the Great Patriotic War, but even now it is operating to the fullest and even exceeds the targets.

Natalya Frolova: Thank you very much. We are glad to hear that.

Tatyana Sabayeva: Mr President, on behalf of the team, I would like to thank you very much for visiting our plant.

Vladimir Putin: Thank you.

Tatyana Sabayeva: We are really proud of this.

Thank you very much for a good and candid conversation. We have memorised your answers, so we will check to see how your answers are acted upon.

I also want to say that thanks to your instructions on the development of our republic – Mr Tsydenov and his team are doing quite well in this regard – the republic has begun to flourish.

Vladimir Putin: This is the highest mark a leader can have. You said, “He is doing well.” That is the best assessment possible.

Tatyana Sabayeva: Yes, he is really doing a good job. We can see our republic making progress. Now we can even have guests, since our tourism industry is developing, and we are happy to welcome guests.

Taking this opportunity, I would like to mention that we have always supported and welcomed your initiatives and undertakings aimed at ensuring a dignified life for all Russians.

We have faith in you.

Vladimir Putin: Thank you.

Tatyana Sabayeva: We are together, and united we are strong.

Vladimir Putin: Exactly. Thank you very much.

Tatyana Sabayeva: Thank you.

We also wanted to have a group photo with you, if we may.

Vladimir Putin: Absolutely, with pleasure.