Russia and France signed on Friday a $1.7 billion (1.2 bln euro) contract on two French-built Mistral class amphibious assault ships for the Russian Navy.
The deal was signed in St. Petersburg by Anatoly Isaikin, director of Russia's Rosoboronexport state-controlled arms exporter, and Patrick Boissier, president and CEO of France's DCNS shipbuilder, who are contracted to build the warships.
The signing ceremony was overseen by Russian President Dmitry Medvedev.
The first warship will be delivered in 2014 and the second in 2015, DCNS said.
French President Nicolas Sarcozy hailed the contract as a sign of strategic partnership between the two countries.
"The signing of the contract... points to a strategic level of cooperation between France and Russia, as well as the constant support that it gets from the heads of state," the Elysee Palace said in a communique.
The project will provide 1,000 jobs over the course of four years, the Palace said.
The warships will be equipped with Russian weapon systems, Navy chief Adm. Vladimir Vysotsky said.
"Construction technology used in building such ships allows Russian weapon systems to be integrated into this project, including amphibious landing assets and carrier aviation," he said.
The use of Mistral class ships will significantly increase the effectiveness of humanitarian operations, he said, adding that they could be used both in peacetime and in wartime for a variety of missions.
The program has alarmed Russia's neighbors, especially Georgia.
Russia and France in January signed an intergovernmental agreement to build two Mistral class helicopter carriers at the STX shipyard in Saint-Nazaire, France. Another two are planned to be constructed later in Russia.
Contract talks stumbled over Russia's demand for the transfer of sensitive electronic systems.
A Mistral class ship is capable of carrying 16 helicopters, four landing vessels, 70 armored vehicles, and 450 personnel.
France has two Mistral class amphibious assault ships in service and is building a third.