About 90 billion rubles are necessary for reviving the Russian machine tool industry, Deputy Industry and Energy Minister Andrei Reus said at the Friday meeting of the Governmental Commission for the Development of Industries, Technologies and Transport.

About 35 billion rubles must be invested in new products, he said, adding that the domestic machine tool market will thus grow to the annual 125-150 billion rubles or 100,000 pieces of equipment by 2015. The production of machine tools will enlarge to 95,000 pieces by that time, as against 7,000 in 2006. Investments will enlarge to 15 billion rubles per year, Reus said.

Current investments in the machine tool industry are obviously insufficient, First Vice-Premier Sergei Ivanov said. The four billion ruble investments planned from the state budget within the next five years are not sufficient either, he said.

“As soon as the government shows concern and assigns funds, private investments will be made,” Reus replied. “There is a market, and we will draw investments.”

Some 20.5 billion rubles were invested in the Russian machine tool industry in 2008, which stood at 1.5% of the overall investments in machine building. The main source of the investments is money of machine tool plants, the official said.

The machine tool industry share in Russia’s GDP amounted to 0.082% this year. An average age of machine tools in the Russian machine building industry exceeds 20 years, while 26 years is the time of the complete wear.

“At the same time, the machine tool industry has survived and even enlarged the production in 2006 following a long period of recession,” Reus said.

Russia may form a united machine tool company, he said in comments on the relevant suggestion by Russian manufacturers.

He said the manufacturers are ready to invest their funds in the company, which will build up the competitiveness of Russian machine tools through the consolidation of the scientific, technical and industrial potential of the industry.

The company will supervise modernization of the industry, replace imported equipped with Russian analogs, reduce production costs through higher labor efficiency, involve in the production the currently idle facilities, and make the governmental support to the industry more efficient, he said.
The project will be drafted, and the government will consider all cons and pros, Reus said.