MOSCOW (Reuters) - Fifty years after Yuri Gagarin blasted into orbit, descendants of the Soviet craft that carried him still generate pride and profit for Russia, but critics say the nation's space program has slid into stagnation.
As it celebrates the pioneering flight on April 12, 1961 that made Gagarin the first man in space, Russia nears another milestone: with the retirement of the U.S. shuttle program this year, it will be the only nation fit to provide rides to the International Space Station.
It is a distinction for a country with a history of space firsts, beginning with the 1957 launch of the satellite Sputnik.
U.S. space agency NASA pays a newly raised price of nearly $63 million each time it sends an astronaut to the orbital station aboard a Russian Soyuz craft from Russia's Baikonur Cosmodrome in Kazakhstan -- the launch pad for Gagarin's flight.
But half a century after Gagarin's 108-minute voyage put the Soviet Union ahead in the Cold War space race, critics charge that reliance on Soviet designs as cash cows has stunted innovation, and that Russia has irretrievably lost its edge.
"While we bask in the glory of having the only operating spacecraft, we are only making money off old rockets," said Vladimir Gubarev, the Soviet spokesman for the 1975 Apollo-Soyuz program, which achieved the first docking of U.S. and Russian spacecraft.
That Soyuz craft was modeled on the generation of ships that catapulted the first Soviet spacemen into orbit, such as Gagarin's Vostok-1.
"You know why we beat America? For a really simple reason: We had the genius idea of making a sphere. Vostok was a ball and we found a man small enough to fit in it," said Gubarev, who covered some 50 of the earliest launches as a space journalist.
Encumbered by a space suit, Gagarin, who was 5 feet 2 inches tall, had to hunker down in a capsule just 2 meters (6 feet 7 inches) in diameter for his single orbit of Earth.
The single-use Soyuz owes its reputation for dependability to the long-secret mastermind of the Soviet space programme, Sergei Korolyov, experts said.
"The Soyuz runs like clockwork," Sergei Shamsutdinov, space expert at Novosti Kosmonavtiki magazine. "Our Soviet engineers, from the get-go, built the craft very well, and today still it is outfitted with 70s-era equipment, which runs beautifully."
In the 1960s, Gagarin's flight seemed to leap off the pages of fantasy novels, inspiring dreams of Martian colonies and imminent deep-space travel.
But much of that initial rapture has now faded, leaving nostalgia among many in Russia for the days when the struggle between the two nuclear-armed superpowers fueled and financed the pursuit of new horizons in science.
U.S. astronauts and Russian cosmonauts "were never enemies in space, but when we began cooperating on the ground they cut the funding," said veteran cosmonaut Georgy Grechko, 79. "Even the Americans would call us and say 'launch something new, so they'll give us money.'"
With competition eclipsed by cooperation, Russia's space agency has survived over the past two decades by hiring out the third seat aboard the Soyuz to foreigners.
"Cooperation is good, but as the example of the international space station shows, it also leads to stagnation," Russian space policy analyst Yuri Karash said, according to state-run news agency RIA.
Gubarev said Russia had fallen so far behind it could achieve little better than a supporting role today in the most cutting-edge projects.
"In the meantime, America will take its time out and build an entirely new spacecraft, so that five or six years down the line our Soyuz will be entirely redundant," he said. "No serious money is spent on breakthrough projects."
Experts say China could soon challenge both Russia and the United States in space. "The most important role will be played by our Russian Soyuz craft now. But we cannot discount the Chinese, who are following their own path and doing all this independently," Shamsutdinov told Reuters.
NASA officials have voiced worries that the current budget financing will not be enough to fund a new rocket and capsule system for deep space travel. NASA's proposed budget for fiscal 2011 is $18.7 billion, some five times higher than Russia's.
Russian industry insiders say President Barack Obama's decision to halt work on NASA's next-generation Orion capsule threatens to take the wind out of a parallel Russian effort to design a replacement for the Soyuz that can fly beyond the International Space Station's low 354-km (220 mile) orbit.
"A little residual competition is a good thing," Sergei Krikalev, 52, who heads Russia's cosmonaut training center after chalking up a record 803 days in space, told Reuters.
Addressing concerns about Russia's role, Prime Minister Vladimir Putin said on Thursday the country could take pride in handling over 40 percent of global space launches but must not be confined to the role of a "ferryman."
"Now Russia is returning to researching the planets of the solar system," he said.
Russia's space agency will receive $753 million to ferry 12 U.S. astronauts to the space station from 2014-2016, NASA announced last month. Russia raked in some $2.5 billion from NASA and partner agencies for 42 seats on Soyuz craft from 2007.
Russia has increased space spending by some 40 percent per year during the last five years, according to Euroconsult, a consulting body that tracks the industry. It has earmarked 200 billion roubles ($7 billion) for space programmes from 2010-2011.
Some of the money will fund a new launch facility in Vostochny in far eastern Russia, where the first launches are anticipated in 2015 and the first manned launch in 2018.
"Gagarin's flight set the bar. We were always the leaders in space exploration and we must uphold this status," the current commander of the International Space Station, Dmitry Kondratyev, said in a pre-launch interview.
Editing by Steve Gutterman and Mark Trevelyan