Russian MoD, Defense Firms Wrangling Jeopardizes Defense Orders

In fighting between the Russian Ministry of Defense and local weapons manufacturer jeopardized state defense order in 2011, said Russian Prime Minister Dmitry Medvedev.

Medvedev on Monday criticized the government’s failure to meet the deadline today for placing contracts for the State Defense Order this year.

According to Deputy Prime Minister Dmitry Rogozin,  only 67.5 percent of government defense contracts have so far been concluded, up 3.2 percent on last year.

“Two-thirds is not a good result,” Medvedev said. “This means there are mistakes both in planning and in contract placement.”

Monday is the deadline for the signing of defense procurement contracts for the current year. This includes R&D projects, delivery of arms and military equipment, scrapping of decommissioned weapon systems and disposal of chemical weapons, he added.

The 2011-2020 arms procurement program stipulates the upgrade of up to 11 percent of its military equipment annually, boosting the proportion of modern weaponry in the armed forces to 70 percent by 2020. Russia has earmarked about 908 billion rubles (just under $30 billion) for state defense spending in 2012, reported Ria Novosti.

Paying up front leads to loss of control over defense orders on the part of the state's contracting authorities, resulting in unfinished construction projects, time overruns, and incomplete deliveries of arms and military equipment, said Russian Defense Minister Sergei Shoigu.