NB: The headline and lead of this story have been changed to clarify the significance of the signed contracts and to reflect that they have not yet been "fulfilled" as stated in the original headline.
NOVO-OGARYOVO, July 29 (RIA Novosti) – Russian President Vladimir Putin said Monday that contracts for 85 percent of the state’s defense procurement plan had been signed with manufacturers, signaling an improvement in official cooperation with the defense industry, which had gotten so strained several years ago that it stymied arms deliveries to the military.
“As for the state defense orders – over 85 percent of the planned number have been placed. This is not a bad result. Contracts have been signed,” Putin said at a meeting on the development of the Russian Navy.
The issue of inefficient placement of defense orders came to a head in 2010 and 2011, when the standoff between arms makers and the Defense Ministry over the price and quality of weaponry disrupted the planned delivery of military equipment to the Russian armed forces.
The most contentious contracts, including those for construction of nuclear submarines by the United Shipbuilding Corporation (USC), were only signed following the direct intervention of Putin, who was then prime minister. As a result, some 95 percent of the required defense contracts were signed by the end of 2011, according to Deputy Prime Minister Dmitry Rogozin, who oversees defense and space industry.
A number of military and defense industry officials have been fired or reprimanded for their poor performance in the implementation of the program, including the former head of USC, Andrei Dyachkov, who had held the job for just 10 months when he was sacked in May.
The situation improved in 2012, although some disputes over the pricing and quality of weaponry persisted.
During the meeting on Monday, Putin gave the government and defense industry officials six months to sort out the remaining controversial issues.
The Russian government has allocated 20 trillion rubles ($641 billion) for a comprehensive rearmament of Russia's Armed Forces, which will see the share of modern weaponry reach 30 percent by 2015 and surpass 70 percent by 2020.