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President Vladimir Putin: Dear Colleagues! Friends!

Today is a very important day for our domestic aviation industry. We have met to establish a National Aircraft Manufacturing Centre in Zhukovsky. I signed the decree for the establishment of this centre today.

I have asked specialists, engineers, technicians, the military and our leading experts in the Presidential Executive Office and in the Government to come here today. I would like this to be a nationwide challenge. Moreover, if we do not set this for ourselves as a goal and concentrate all our administrative and political resources on it, the way we have done for the national projects, we will not meet this challenge. And we absolutely must meet it, not only because aviation and the space industry have always been the pride of our country, and not only because in recent decades some parts of these industries have lapsed to a considerable extent, but because of course this is our future. If we want to ensure the innovative character of Russia's economy as a whole, without aircraft industry we cannot meet this challenge. The decision to build this innovative research and development complex is not only symbolic but also logical. At one time, in this very city an experimental research base for our aviation was established: the CAHI [Central Aero-Hydrodynamic Institute] and the Gromov Flight Research Institute. Their research and experimental designs have had a significant impact on the development of domestic aircraft manufacturing.

I am convinced that today there is every possibility of Zhukovsky's becoming a dynamic centre for aircraft manufacturing in Russia, and not only in Russia but in Europe and the world. We are going to create a large, important aviation cluster here: house institutes and a united engineering centre; develop various units of the main firms operating in the aircraft industry as well as in related industries; build a modern industrial, transport, engineering, and of course social infrastructure. There will be a whole network of venture undertakings and companies here. Additional opportunities must be offered to small businesses for independent laboratories, design bureaus and research centers.

The spirit of such an environment is designed to encourage innovative economic growth and in many ways is a project of the city of the future, without any exaggeration. Can this be done? I am absolutely convinced that it can. As you know, we have a saying: ”The eyes are afraid, but the hands do the work.“ But there is nothing to fear, absolutely nothing to fear, it is an absolutely feasible project. Yes, it will require large resources. I won't say enormous resources, but large resources, which are entirely within our capabilities. We have these funds, and we can count on the determination and efforts of the Government, the Presidential Executive Office and other specialists. I believe that building such a centre in Zhukovsky, a united aircraft manufacturing centre, is absolutely feasible.

Also in Zhukovsky in 2005 there was a meeting of the State Council Presidium, where it was decided to establish the United Aircraft Corporation (UAC). The decree concerning this venture came out exactly two years ago. In that time the UAC has helped to consolidate the capabilities of leading aviation companies and organizations, and, critically, helped build new Russian planes.

I would note that in recent years the number of products produced by the aviation industry has grown, and today accounts for nearly 40 per cent what is produced by the Russian defence industry and more than 43 per cent of this it’s military products. And last year output grew by almost 17 per cent. Of course, our experts realize that these are not particularly impressive figures. But they will continue to be unimpressive if we do not take a qualitative leap forward.

In view of the stiff competition from the world's major producers, the company must firmly establish itself as one of the leaders in the aviation market, and by 2025 the volume of the defence industry revenue should increase by at least five times. In addition, Russia must produce more diverse products and set a number of specific guidelines for different portions of the military, transport and civil aviation industries. In principle, these objectives have been formulated and defined. Thus a programme concerning civil aviation, long-haul aircraft of the twenty-first century and a new wide-body aircraft, must be implemented in a timely fashion and with the highest quality standards.

We talked about our perfectly natural niches in specialised and transport aircraft. I consider it unacceptable that foreign buyers are getting state-of-the-art combat aircraft from Russia, while our air force is largely confined to upgrading machines produced many years ago. I think that we should change the state programme Armament and increase the acquisition of modern aircraft for the country's defence needs. But we have discussed this many times with the General Staff and the Ministry of Defence. Of course, I understand the desire to supply work for our factories that are involved in repairing equipment, but we can make a qualitative leap forward, and we need to take advantage of the current situation.

By the way, we have to start thinking – I said this to the Defence Minister today and I will be saying the same thing to the Government – about financial support for our armed forces, especially for those troops on whose shoulders lies the responsibility of our country's defence. It is intolerable that a military pilot should receive a mere fraction of what his counterpart in civil aviation earns. The same goes for the navy. We need to think about these questions, really reflect on them.

The development of our economy and improvements in the social sphere are so impressive that we cannot postpone addressing these issues any longer, just as we have to address the social problems of our servicemen. I am thinking about a extension of the 15 plus 15 housing programme, perhaps to other parts of the country, beyond those five places we chose where recovery was especially difficult due to the extremely expensive housing. We should extend the certificate programme and develop the mortgage system. The Government must provide all this as soon as possible.

Then there's the question of flights [in-flight hours]: it's clear that we have to increase the number of flights. They have increased by several times from what they were in, say, the early nineties, but they still do not meet the necessary standards and criteria. We need to meet those standards.

The creation of a national aircraft manufacturing centre will be instrumental in helping us to achieve the following strategic goals.

First, we need to create the conditions for closer cooperation and integration in the aviation industry, science and education. And we must agree on the formation of a new structure for upgrading technology, research and experimental areas. We need to proceed according to a single plan and a single programme.

Secondly, we welcome cooperation with foreign partners and mutually beneficial projects with our international partners. Such projects should primarily contribute to the development of domestic industry. Therefore, participation in them is not an end in itself but a means of developing our own high-tech economy. It should be borne in mind that, when the negotiating process with foreign colleagues drags on for too long, we must implement our plans without waiting for potential partners to get on board. Otherwise we will lose out in the competition. They also have many institutional and financial problems, as our experts are well aware. Well, then, why wait around while they cope with them?

To promote the production of Russian aircraft manufacturers one should make greater use of the Rossiya transport and exhibition complex. There they must show samples of military equipment and civilian high-tech products, and of course the complex must be renovated. What we see today is unworthy of Russia. If we just slap together something or other, this is still not an exhibition centre. Decisions must be taken on the basis of the decree signed today, which should make this centre one of the most attractive in Europe.

There is also a need for better quality training and improving the skills of the flight crews, including through new training equipment. So, the pace of work in the aviation industry to a great extent determines the level of the flight crews' training. Incidentally, we plan to establish such a training centre here, a new centre at a new equipment base.

Again, we want to create an integrated environment in Zhukovsky for researchers and test operators, postgraduates and students, for anyone who develops, constructs and tests new aircraft. I hope that the National Aircraft Manufacturing Centre in the coming years will become a supplier of new ideas and a motor for the entire aviation industry.