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President Vladimir Putin: Good afternoon,

(Addressing Deputy Prime Minister and Defence Minister Sergei Ivanov) Sergei Borisovich, you are holding a meeting of the Military-Industrial Commission?

Sergei Ivanov: We are holding a meeting of the Military-Industrial Commission today and will be examining several issues. I would say the key issue is that of increasing production of quality Russian-made civilian airplanes that meet all ICAO standards.

We all know that there are a lot of problems in civilian aircraft manufacturing in our country, and this is why we recently established the United Aircraft Manufacturing Corporation. At today’s meeting we will examine the calendar for building civilian aircraft, above all the new generation Superjet aircraft. Incidentally, the first of these planes arrived in Moscow from Komsomolsk-on-Amur on board a Ruslan military transport plane. It was loaded inside without the wings, has been delivered, and will undergo its first flight tests very soon.

We plan to build at least 700 such planes over the near future. Carriers, above all here in Russia, very much need this plane. This is a short-haul plane and this is an area where we have a lot of demand to fill.

The Commission will also examine the question of insuring financial risks involved in fulfilling state defence procurement orders, and it will discuss setting up a special working group on pricing for military-purpose goods. We need this group if we are to properly fulfil state defence procurement orders from year to year and implement the state Arms Programme, because we still face some price formation problems. Prices are sometimes quite provisional, you know, and we need to bring some order to this area so that to properly meet state defence procurement needs.

Vladimir Putin: Good.

(Addressing Foreign Minister Sergei Lavrov) Sergei Viktorovich, you plan to take part in the work of the Middle East ‘Quartet’?

Sergei Lavrov: The ‘Quartet’ of mediators in the Middle East peace process will hold a ministerial meeting this week in Washington. We have long since advocated holding just such a meeting as soon as possible, but it’s better late than never. The situation in Palestine is extremely complicated. Efforts to revive negotiations with Israel have run up against the threat of civil war in the Palestinian territories themselves. The ‘Quartet’s’ task is to help end the standoff between the Palestinians, above all between Fatah and Hamas, and end the attempts regrettably coming from outside to provoke divisions between these two groups.

We are working actively in accordance with your instructions to help form the government of national unity that Mahmoud Abbas spoke to you about during your last meeting. In principle, if attempts were not being made to hinder them, these two main Palestinian groups could reach an agreement quite quickly. Hamas is ready to recognise in the government platform the previous agreements with Israel and the decisions of the UN and the Arab League, and this reflects in part our work with this group and the efforts the Syrian authorities have been making to work with Hamas, including in accordance with an agreement with you. We will now try to act on this objective possibility, though the discussion will not be easy.

Vladimir Putin: Good. Report again when you come back. Thank you.

As you know, I was in India last week with a large group of our colleagues and I will tell you in more detail later about the visit overall. We consider the visit to have been a success. We reached all the goals that we set both in civil and military cooperation. I would like to ask the Prime Minister to oversee the full implementation of the agreements reached with our Indian colleagues on expanding the possibilities for making use of India’s rupee-denominated debt to the Russian Federation. Our Indian colleagues agree with these proposals. There are a number of major projects of interest to both countries. They all concern high-technology, which is extremely important for our country, and we therefore need to implement these agreements in full.

Just as important was our trip to the Far East to look at the possibility of holding the Asia-Pacific Economic Cooperation summit in the Russian Federation, in Vladivostok, to be precise. We have decided to propose that Russia host the summit in Vladivostok. We agreed with our regional colleagues and with the governor that we would concentrate on Russky Island as a venue. This requires us to settle in full all financing issues. I remind you that this will all call for major infrastructure development work in the city itself. A complete overhaul of the airport will be needed, including construction of a new terminal, complete overhaul of equipment and modernisation of the runway itself. Work will also require road construction, resolving sewerage and water supply and energy supply issues and building a bridge to link Russky Island to the mainland.

As I said, this is a large-scale and costly undertaking. The preliminary estimates suggest around 100 billion roubles will be required. Once the summit is over, we plan to make use of the new facilities to create a tourism zone that could be used by people not only from the Far East but from throughout Russia, because the area offers unique opportunities in terms of establishing a thematic tourism and recreation zone. Not so long ago we had planned to build a new building for the Marine Biology Institute of the Russian Academy of Sciences’ Far East Division at Patrokl Bay, as well as a large oceanarium with a recreation base and hotel. Given our plans to hold the APEC summit on Russky Island, it would make sense to shift these projects there. As for the territory that has already been cleared and the land received from the Defence Ministry, a lot of money has already been spent preparing it for construction, and it could now be handed over to the city for housing construction. I think the social component should come first in a major project of this kind, and I therefore instruct the Government to carry out the necessary preparatory work, hold the necessary tenders and work with the city and regional authorities to organise the construction of what will be essentially a new district of Vladivostok. I note that we received 248 hectares of land at Patrokl Bay from the Defence Ministry, and considering that we got this land from the Defence Ministry, it would be only fair to use a large part of this site for building housing for servicemen from the Vladivostok garrison and servicemen serving in the Primorye Region.

We need approximately 52 residential buildings for servicemen, and this will cost around 5 billion roubles. Overall, the remaining part of the site, two thirds of the site, should be handed over to the city, and we need to help the city carry out this project. The governor of Primorye Region informed me yesterday that he thinks around 500,000 square metres of housing could be built there, and that is quite a lot. The site is beautiful and the project should be good and attractive. If we begin immediately, we will need around six months to get the plans ready and we could begin construction by the end of the year. I want this project to go ahead.

As I said before, we have a unique opportunity on Russky Island to create a very interesting recreation and leisure zone enjoying a corresponding preferential regime and offering a scientific component for everyone who loves the sea and the ocean. Perhaps this will encourage more Russians to holiday in their own country and then we would see fewer tragedies of the sort we hear about abroad, tragedies linked to the increase in people going underwater hunting, diving and so on. I ask you to work on these plans and report to me soon.

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