By Isabel Gorst in Moscow
The war of words between Moscow and the west over missile defence intensified over the weekend as Vladimir Putin, Russia’s president, declared a new radar station near St Petersburg to be “the first step in a large-scale programme”.
Moscow has said it would bolster its air defence capability in response to US plans to site early-warning systems in the Czech Republic and missile interceptors in Poland to protect against attack from Iran or North Korea.
Washington insists the anti-missile system is to deal with “rogue” states, but Mr Putin has said the installations would risk turning Europe into “a powder keg” and has threatened to retarget Russian missiles on Europe if the US goes ahead with the plan, opening the most serious rift in Moscow’s relations with Washington since the cold war.
Mr Putin’s weekend comments are the latest in a series of statements that have heightened tension between Moscow and Washington, despite the Bush administration’s attempts to clear the air.
The US has stated it has no intention of counteracting Russia’s strategic nuclear arsenal, but Moscow sees the Polish and Czech plans as an unjustifiable incursion into a region formerly part of its sphere of influence.
Mr Putin, touring the Voronezh missile interceptor station 30 miles north of St Petersburg at the weekend, said it was “the first step in a large-scale programme ... to  be carried out before 2015”.
Voronezh, opened last December, can monitor territory from the North Pole to Africa. “This is what I call the modern development of the armed forces: a lot cheaper and a lot more efficient and dependable,” Mr Putin said.
Mr Putin said fulfilment of plans to double Russia’s annual production of military aircraft by 2025 would require a radical shake-up of domestic aircraft engine manufacturing capacity. “The competitiveness of aircraft engines produced in our country today is, unfortunately, low, extremely low.”
The government plans to consolidate aircraft engine manufacturing companies into a large, state-controlled holding similar to Oboronprom, the helicopter monopoly, and Rosoboron export, the state arms export company.
Mr Putin also toured the Klimov helicopter engine plant near St Petersburg, which had been on the verge of bankruptcy three year ago but is undergoing modernisation.
Alexei Grigoryev, the head of construction at Klimov, said the government’s consolidation plan would help engine-makers beat competition from world players, including General Electric and Pratt & Whitney of the US and Snecma of France.
Russia, the world’s second biggest weapons supplier, exported $6.5bn-worth of arms in 2006, largely in the form of aircraft equipment.
Mr Putin was accompanied by Sergei Ivanov, Russia’s deputy prime minister, whom he praised for efforts to modernise the armed forces.
Mr Putin said he hoped the defence ministry, now led by Anatoly Serdyukov, would “do literally everything to ensure fulfillment of plans to modernise the army and navy.”
Earlier this month the commander of the Russian navy called for the establishment of a naval base in the Mediterranean to defend Russia’s strategic interests in the area.
The Navy also announced that Russia was ready to launch serial production of its new Bulava submarine launched intercontinental nuclear missile which Putin has said can penetrate any defence system.
However, military experts said testing of the Bulava was incomplete and that the Navy chief was sabre rattling.