Aviabalt, a subsidiary of Russia’s Technospetstal-Engineering, is expected to bring in 1 billion rubles (nearly US$38.6 million) at the expense of debenture bonds that will be issued, according to Uzbekistan Today news agency.

These funds will be used for the purchase of components for the production of IL 114-300, turbo-prop middle-range aircraft, in Tashkent, the report said.

In May 2006, Technospetstal-Engineering (St. Petersburg) signed a contract with Tashkent Chkalov Aircraft Association (TCAA) for the production in 2006-2008 of thirty IL-144 planes powered by Russia engines TV-117SM. In accordance with the contract, the airplanes will be fitted with Russian-made avionics, namely, modernized digital aviation complex.

Besides, TCAA is to supply Uzbekistan Airways National Air Company with two IL 114-100 passenger planes till the end of this year. In 2001, TCAA and Uzbekistan Airways concluded a contract for the acquisition of three IL 114-100 planes worth US$21.5 million. In 2002, the National Air Company received its first plane and in early 2003 put it into commercial service for local routes.

The substantial portfolio of orders for this type of airliners is attributed mainly to the problem of renewal of passenger air base of middle-range planes. An-24 and Yak-40 types can no longer satisfy the carriers of the CIS which are experiencing a deficit of the new technology of the said type.

Regional carriers in the CIS are ready to purchase new planes. Vyborg, a Russian air company, is already using two IL-114 planes. "This plane will cover its cost within 5-7 years," says Georgiy Nazarenko, Director General of Vyborg. According to him, the company is ready to put into service ten planes a year, which will allow it to carry out air transportation in the northwestern direction.

According to Aviabalt estimates, the potential capacity of the market of regional planes in Russia is 250 units. But this is not the limit: considering the fact that investors are starting investing into the development of regional airports, it cannot be ruled out that in the near future the demands for middle-range planes will largelyincrease.