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MiG Chief Under Fire, Likely to Be Jettisoned

    Friday, October. 31, 2003
    The Moscow Times
    As the state-owned manufacturer of MiG fighter jets looks set to land its largest-ever defense contract, its director may be heading for the chop. Industry analysts and players suggest the long-negotiated deal to refit the Admiral Gorshkov aircraft carrier and supply a batch of MiG-29s to the Indian Navy for an estimated $2 billion is too lucrative to stay in the control of Nikolai Nikitin, and that a new frontman will be picked to see the deal through.
    Yet the official line is different. The Russian Aviation and Space Agency, Rosaviakosmos, voted late Wednesday for a recommendation to the government to relieve Nikitin of his post as general director of RSK MiG.
    One source from Rosaviakosmos and one from an aviation company said that the agency's chief, Yury Koptev, opened the meeting by saying he had recently been summoned by Prime Minister Mikhail Kasyanov. He said Kasyanov criticized harshly the lagging on the government's Tu-334 short-range passenger liner project, which is to be assembled at a MiG facility.
    In order to diversify its business, MiG picked up the stagnant Tu-334 program in 1999 and was to launch mass production next year. The program has slumped due to measly financing, with MiG putting up $47 million, but no money coming from the state's budget.
    MiG would not comment on Nikitin's fate, but a source said that at the meeting Nikitin had stood up to say he disagreed with the recommendation, which was voted in almost unanimously.
    Rosaviakosmos' recommendation comes less than two weeks before Indian Prime Minister Atal Bihari Vajpayee starts a visit to Moscow. George Fernandes, the Indian defense minister, was quoted by Bloomberg as saying that India plans to finalize negotiations with Russia on buying the aircraft carrier while Vajpayee is in Moscow. Russian aviation industry sources have also suggested that the deal could be signed during the visit.
    Following negotiations that have lasted for nearly a decade, Russia and India have settled on the price of $675 million to refit the carrier, which will have some 20 MiG-29s on board, media reported.
    Firing Nikitin for trailing on the Tu-334 project would be a cynical decision, Boris Rybak, first deputy director of the National Project 334 venture said by phone Thursday.
    "Nikitin was the only real support for the program," Rybak said. "I think this recommendation is more likely to do with the [upcoming] defense contracts."
    Konstantin Makienko, deputy head of the Center for Analysis of Strategies and Technologies, agreed.
    "The situation at the firm has gotten better, new defense contracts are expected," he said, adding that the firm, which had no contracts or cash in the late 1990s, had been "brought out of a coma" with Nikitin's appointment.
    In 2001, MiG signed $1 billion worth of contracts for 36 MiG-29s and last year delivered $370 million worth of jets.
    Makienko said that taking up the Tu-334 project had been a mistake.

    Lyuba Pronina
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