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Russia Spends Almost All of the National Welfare Fund on Aircraft Purchase

Russia has reportedly expended nearly all of the 300 billion rubles allocated from the National Welfare Fund (NWF) to acquire airplanes from foreign lessors. This information comes from sources within the Russian government, as reported by the publication Kommersant.

The latest funds were utilized for the purchase of 28 aircraft for Aeroflot, 45 for S7, and 19 for Ural Airlines. In total, the NWF covered the acquisition of 150 aircraft.

The majority of the funds, 250 billion rubles, were allocated to acquire 86 Aeroflot aircraft from lessors. Private Russian airlines received approximately 30-40 billion rubles from the NWF.

The private airline iFly agreed to leasing terms for three Airbus planes for 9 billion rubles but was unable to secure funds from the NWF for even a single aircraft. According to sources, the government is unlikely to consider the interests of charter companies with small or older fleets in the future.

The allocated funds were provided as preferential loans at a 1.5% interest rate for 15 years. The leasing company “NLK-Finance,” under the control of Rosaviatsiya, became the new owner of the airliners.

As of now, only 3.5 billion rubles remain from the allocated 300 billion rubles in the NWF, and they will be used to settle claims with the owners of Aeroflot aircraft.

Sources in the Russian aviation industry suggest that discussions about allocating additional funds from the NWF are not currently underway. However, negotiations for the continued purchase of aircraft from foreign owners are ongoing for Aeroflot, Ural Airlines, and S7.

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