Putin Says Sochi On Track, Sponsors Pledge $460 Ml

Russia would set aside 127 billion roubles ($3.6 billion) from this year`s budget to finance Olympic projects.

Russia's 2014 Sochi Winter Olympics secured a $460 million corporate sponsorship deal on Saturday and Prime Minister Vladimir Putin said the resort town would be ready to stage the games on time.

The games' organising committee said it was the largest domestic sponsorship in the history of the Olympics.

State-controlled long-distance telephone company Rostelecom and Russia's No. 3 mobile carrier, MegaFon, pledged $260 million in sponsorship, plus a further $200 million to develop infrastructure in the region, the committee said in a statement.

On Friday, Putin told International Olympic Committee (IOC) member Jean-Claude Killy that Russia would set aside 127 billion roubles ($3.6 billion) from this year's budget to finance Olympic projects, up from 113 billion roubles last year.

"Despite the well-known global financial and economic difficulties, which also affect us, everything concerning the Olympic project ... is protected by the budget and is guaranteed to be financed," Putin said at the meeting with Killy.

Russia has pledged to spend $12 billion on developing Sochi, a resort on its Black Sea coast, for the Olympics. Winning the right to host the games is viewed by many as one of Putin's major achievements during his eight years as president.

But since November, the Russian rouble has lost over a fifth of its value, adjusting to a decline in commodity prices and the country's worst economic outlook in a decade.

Managing the fall has cost Russia a third of its gold and foreign exchange reserves while real estate and construction are among the sectors worst hit by the global financial crisis.

Dmitry Kozak, deputy prime minister in charge of preparations for Sochi, said the budget for the games would be revised as a result of the falling rouble. He did not give a new figure, and said it could be raised or lowered.

"There has been a decline in the price of construction materials and an increase in competition for government construction contracts as a result of the difficult economic situation," Kozak told reporters on Saturday.

The organising committee said more sponsorship should be forthcoming. Tenders will be held to select major sponsors from the oil, gas, metallurgy and apparel sectors to join Rostelecom and MegaFon, which is part-owned by the Nordic region's biggest telecom operator, TeliaSonera.