Gaddafi fall cost Russia tens of blns in arms deals

By Alexei Anishchuk

ST PETERSBURG, Russia Nov 2 (Reuters) - Russia lost tens of billions of dollars in potential revenues from arms deals with Libyan leader Muammar Gaddafi's fall, the official in charge of Russia's arms exports said on Wednesday.

Russia, the world's No. 2 arms exporter, has frequently cited losses of $4 billion in Libyan arms contracts.

"The figure of $4 billion is only nominal, the real lost revenue could top tens of billions of dollars," said Mikhail Dmitriyev, the head of Russia's Federal Service on Military and Technical Cooperation.

"There is no doubt there were losses... We have no contacts with the new Libyan leadership in the (defence) field any longer," he told reporters in the northern city of St Petersburg.

The Kremlin has been criticised by some diplomats for its ambiguous stance in the Libya crisis: failing to support the Western-backed revolt against Gaddafi, backing sanctions against him and allowing Western military action.

Such was the discord within the Russian elite over Libya that it provoked a rare public disagreement between Prime Minister Vladimir Putin and President Dmitry Medvedev.

Russian companies have invested hundreds of millions of dollars in oil and gas exploration there, and Russian Railways was building a railway under a 2.2 billion euro ($3 billion)contract.

Arms contracts signed under Gaddafi's rule made up 12 percent of Russia's 2010 arms exports, worth a total of $10 billion. An arms embargo imposed in February caused Russia to forfeit $4 billion in new contracts.