Even as Gov. William F. Weld 66 faces a widespread New England recession and a burgeoning budget deficit, he can look to one bright spot in the economy--the state's booming military defense industry.

Massachusetts's military supply companies, fueled by increased demand due to the Gulf war, are stepping up production at a time when most Massachusetts businesses face production cutbacks and layoffs.

The Lexington-based Raytheon company, the prime contractor for Patriot "antimissile missiles," currently has plans to increase production and to revamp its missile launching system, said Jonna Manes, spokesperson for the company.

Raytheon recently signed a $513 million contract with the U.S. Army, calling for Raytheon to manufacture eight new missile launching systems and 300 missiles, Manes said.

"The Army has requested speedier delivery and improved quality," she said. "Naturally that's forced us to speed up production."

New Federal Funding

And in addition to the Army contract, new federal funds will likely be available to Raytheon and other antimissile companies.

At a time when most defense programs are being cut, President Bush proposed on Monday a three-fold government funding increase for research and development of antimissiles.

And although missile firms outside Massachusetts may also compete for the funding, Raytheon, as the current leader in the market, stands to gain the most.

If approved, the additional funds will enable Raytheon to produce an upgraded version of the system, capable of intercepting incoming weapons earlier in their flight paths, spokespersons for the company said.

But while Raytheon may be raking in million-dollar contracts from the military, other defense contractors in Massachusetts claim that the war has not significantly increased their business.

"We haven't really stepped up production at all," said John Morris, manager of media relations for the aircraft engine division of General Electric in Lynn, Mass., which produces engines for many of the helicopters and airplanes employed in the Gulf. "I don't see [the war] having any major impact soon."

Morris explained that the Pentagon stores such ample supplies during peacetime that shortages are slow to develop once a war actually begins.

"The reason you don't have to step [production] up is that the military generally already has quite a stockpile of engines and parts," he said.

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