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President Vladimir Putin: Good afternoon, dear colleagues. Today’s meeting is devoted to problems of military and technical cooperation.

There are two main issues on the agenda. Above all, to sum up the results of military and technical cooperation with foreign countries for the past year, and also to take measures that will allow us to make this work more effective and more profitable economically.

Among the positive tendencies, I would like to note the access of Russian manufacturers to new markets, and the strengthening of corporate ties. There has been a noticeable increase in the activity of enterprises which have received the right to independent export of spare parts and post-warranty servicing.

A great deal still needs to be done here to make this activity less bureaucratic. We have already talked about this with the Defence Ministry, Rosoboronexport and the respective committee: if enterprises have received this right, then we need to save them the need to run around the corridors of power receiving additional signatures and wasting time solving administrative issues.

But that which has been done has already made it possible to increase deliveries of military equipment in 2004 by $200 million, and in general to pass the $5.7 billion mark. As a result, our country has a firm position among the five leading exporters of military production.

However, it is also clear that there are significant potential resources for further development of the Russian defence and industrial complex. This involves a noticeable financial profit for the country and the possibility of increasing it. Along with strengthening the position of national manufacturers on traditional markets, our task is still to reach new weapons markets and increase competitiveness of production.

What resources are these?

Above all, today enterprises of military and technical cooperation have a significant portfolio of orders, which makes it possible to plan volumes of delivery with reasonable certainty, but only for 2005. It is necessary to formulate strategic actions for the middle-term perspective, from 2006 to 2010.

The projected figures should stimulate the work of defence enterprises and be taken into account in improving the defence and industrial complex, such as by creating major integrated companies, the projected capacity figures of which, including from Russian state order, will in many ways determine their internal structure, and ultimately the structure of the entire defence and industrial complex of the Russian Federation.

The second thing I would like to pay attention to is deepening cooperation with European partners, including through joint projects on developing and producing weapons. A number of projects have already been realised here, there is good experience, and it needs to be developed. We have seen for ourselves numerous times that this cooperation can drastically increase the competitiveness of Russian defence enterprises, above all by reducing expenses, and in joint use of leading, truly breakthrough technology. During our discussion, I would like to hear your proposals for improving the mechanisms of this work.

Third, the diversification of deliveries and the expansion of the geography of deliveries remain important. Last year there was noticeable progress made by naval technology, but so far there have not been any fundamental changes in the nomenclature of export. The main component remains aerotechnics. This is not bad, it is even a good thing, because this equipment – is leading equipment, undoubtedly the best in the world, which makes it possible to further develop our military aircraft construction. But I repeat once more, we are all interested in the expansion of our nomenclature.

As I have already said, serious attention here needs to be given to finding new markets. Russian manufacturers need to be more active in making their capabilities known, including at major international weapons exhibitions. One of these exhibitions has just been held, and I hope today to hear information about the results of work at this exhibition.

Another issue on the agenda is the development of military and technical cooperation with the nations of the Collective Security Treaty Organisation and other member nations of the Commonwealth of Independent States. This area remains a priority for us, and the basic task today is to assist the strengthening of the system of collective security, which makes it possible to react effectively to modern threats, and reliably ensure the peaceful lives of our citizens. We should make more active use of the potential of Russian defence industry, and deepen manufacturing and scientific and technical cooperation within the CIS, and to do this we must improve the normative base, and liquidate the bureaucratic barriers that I have mentioned earlier.

Serious attention needs to be given to training national military personnel. This year, financing has been increased on training miltary from CIS countriesthrough enhancing their professional level in Russian institutes. I believe that this training in the framework of unified programmes is a factor that will seriously strengthen the defence potential of our countries. I would ask the Defence Ministry and the Finance Ministry to make sure that the interests and requirements of our partners are taken into account more efficiently and to a greater extent. I am absolutely sure that this fully meets the national interests of Russia in the long-term and middle-term perspective.