Interview of FSMTC of Russia First Deputy Director A.V.Fomin to Interfax Agency

1. What are preliminary results of military-technical cooperation of the Russian Federation with foreign countries in 2011? What is a total amount of deliveries of the Russian weapons and combat materiel abroad? How has the geography of deliveries changed? With what countries have the relations developed most dynamically? What is the structure of weapons deliveries?

The last year was marked with outperforming of planned targets in MTC. The export amount of military purpose products to foreign customers exceeded 13 billion USD.

India remains our key partner in the military-technical area with a quarter of all exported products. Key importers of the Russian arms are China, Venezuela, and Vietnam.

Traditionally, a share of the aircraft equipment amounted to more than half of the amount of all deliveries. A quarter of the export fell to a share of the land forces equipment. 10 percent is a share of naval and ADMS deliveries.

2. What is the forecast for 2012? Could you again hit records? What is the value and structure of the portfolio of orders?

According to our estimates, the export forecast of more than 13.5 billion USD for 2012 will exceed the 2011 amount.

The portfolio of orders, less obligations to Libya and Iran frozen due to the sanctions of the United Nations, exceeds 40 billion USD, which will provide sustainable operations of the MTC system for the next years.

Today, as earlier, aircraft equipment, including Su planes, Mi and Ka helicopters (more than 40 %), prevails in the portfolio structure. ADMS, including S-300 and Buk, Pantsir-S1, with its share of one fifth of the obligations, are in great demand among foreign customers. The amount of orders in interests of the Navy and land forces is approximately at the same level.

3. How much justified was the decision to authorize a number of defence enterprises to independently enter the market servicing earlier delivered arms? How many enterprises are authorized, what was the amount of FX receipts generated by them last year? What are the enterprises in this area?

It was perfectly justified to authorize enterprises of the military-industrial complex, being traditionally leading developers and manufacturers of arms and military vehicles, to carry out independent foreign trade activity relating to deliveries of spare parts, repair and maintenance of earlier delivered arms.

Thanks to ability of the leaders, holders of specifications, to provide high-grade and high-quality after-sales service, carry out flexible price policy when selling spare parts, and quickly respond to any delivery bottlenecks, export volumes of those 21 enterprises increase from year to year. In 2011, it reached 2.5 billion USD. SUE KBP, RSK MiG OAO, Sukhoi Company OAO, VPK NPO Mashinostroeniya OAO, FSUE KBM, FSUE NPC gazoturbostroyeniya Salyut, etc. are among the best performers.

4. Many sceptics predicted that the Russian weapon export would be strongly affected by the well-known events in the Middle East and the North Africa. What are the losses of the Russian weapon export caused by scrapping MTC with Libya? Are there any chances to return to this market?

It is necessary to note that suspending MTC with Libya, the Russian Federation implemented the resolution of the UN SC. It was not our decision, it was a compulsory measure. As a result, the Russian weapons export lost about 2 billion USD. Chances to return to this market remain. A considerable quantity of arms and military vehicles of the Soviet period remaining in Libya and requiring service, repair and modernisation is one of objective preconditions for our return to that country.

5. In the recent years, Russian exporters have made a hectic headway in Latin America. At what stage are large weapons contracts with Venezuela, in particular, for constructing two factories to produce Kalashnikov automatic machines and related ammunition, and delivery of air defence missile systems and armoured vehicles?

Military-technical cooperation with the states of Central and Latin America, in particular, with Venezuela, develops at a dynamic pace. Contracts concluded with the country are being consistently implemented. The leadership of Venezuela is satisfied with the progress of deliveries of Russian hardware.

6. Are any negotiations for delivery to Brazil another batch of Mi-35 helicopters or other helicopters carried on? How many Mi-35 out of 12 have been already delivered to the customer?

Now, 6 Mi-35M helicopters have been delivered to the Federal Republic of Brazil. We would like to hope for further cooperation in this area.

7. When can the contract for delivery to Brazil Russian Tigr armoured vehicles be signed? Have tests of this vehicle been completed in Brazil?

The vehicle has been delivered to Rio de Janeiro for carrying out demo tests. On request of the customer, supplementary equipment has been installed and the vehicle has been upgraded. Today, tests of the upgraded vehicle have been completed, and representatives of the foreign customer analyze the results. I hope that negotiations in this area will go on.

8. Are there any weapons contracts with Chile, Argentina, and Mexico? What Russian hardware attracts their interest?

Unfortunately, we have no current contracts with Chile.

In August 2010, a contract for delivery of 2 Mi-171E helicopters to Argentina was signed and, in the end of 2011, they were delivered.

We cannot call military-technical cooperation with Mexico as large-scale, however, there are positive tendencies in its development. In particular, the Russian and Mexican Parties made decision to resume the dialogue about signing an intergovernmental Agreement for military-technical cooperation, in December 2011, a contract for delivery of 3 Mi-17-V5 helicopters was signed.

9. At what stage is the contract for delivery of 21 Russian helicopters to Afghanistan? How many helicopters have been already delivered?

The Russian Party continues to successfully perform its contractual obligations between Rosoboronexport OAO and the Ministry of Defence of the United States of America on delivery of 21 Mi-17-V5 combat transport helicopters for the Afghan national army.

As of 29 December 2011, 9 Mi-17-V5 helicopters were delivered to Afghanistan. During the 1HY2012, it is planned to deliver another 12 Mi-17-V5 helicopters and related materiel.

10. Are any negotiations to purchase in Israel another batch of drones carried on? (There is a talk about a $100 million contract to be concluded). How many drones have been already bought?

In 2010, we purchased from Israel a number of UAV Reconnaissance Systems. Cooperation in UAV Reconnaissance Systems is feasible.

11. Does Russia maintain any military-technical cooperation with North Korea, at least, in respect of delivery of spare parts?

At present, practically, Russia does not maintain any military-technical cooperation with North Korea, taking into account restrictions introduced by Decrees of the President of the Russian Federation dated 27 May 2007 № 665 «On measures to implement Resolution of the UN Security Council 1718 dated on 14 October 2006» and dated 27 March 2010 № 381 «On measures to implement Resolution of the UN Security Council 1874 dated 12 June 2009».

12. How successful are intergovernmental agreements for the Russian-Indian fifth generation fighter and a medium range transport plane known as project МТА?

Agreements between the Government of the Russian Federation and the Government of the Republic of India for cooperation in developing and manufacturing an advanced multirole fighter, and cooperation in developing and manufacturing a multirole transport plane as a whole are being implemented successfully.

13. What are our chances to be awarded with the contract for purchase of 197 light weight helicopters? When will the winner of this tender be announced?

The Government of the Republic of India in December 2008 announced the international tender for purchase of 197 light weight helicopters.

Rosoboronexport OAO and Vertolyoty Rossii OAO with Ka-226T helicopter and the Eurocopter European firm continue their participation in the tender.

The Russian helicopter has successfully passed all stages of assessment tests signed with relevant certificates. Now, the Minister of Defence of India completes a technical assessment of tests to be followed by opening of bids. According to available information, the Russian helicopter has quite good chances for victory. We believe that the tender winner will be announced this spring.

14. When will a contract for delivery of another 42 Su-30MKI fighters to India be signed?

In December 2011, we signed the Protocol to the intergovernmental agreement for a larger licensed manufacture of 42 planes. Now, Rosoboronexport OAO carries on negotiations for a draft contract to be signed in 2HY2012.

15. What is your opinion of prospects for purchase by China of Russian ADMS (S-300PMU-2 Favorit, S-400 Triumph, etc.), and a new Russian Su-35 multirole fighter? According to informal data, the Russian package of proposals includes, among other things, proposals for licensed manufacture of Su-35 in China.

During 1993 – 2010, in pursuance of the military-technical cooperation, a significant amount of Russian air defence missile systems, including S-300PMU-2 Favorit, were delivered to China. As to a further ADMS cooperation with China, today, our Chinese partners express interest in acquisition of S-400 Triumph, a new generation of the air defence missile systems, and they would like to receive the first batch in 2015. Delivery prospects to China of S-400 Triumph, a new generation of the air defence missile systems, including timing of these deliveries, can be determined with due regard to implementing the objective to equip the Armed Forces of the Russian Federation with those systems. Now, we build additional capacities to produce S-400 Triumph. The Chinese Party has not yet shown any interest to purchases of other ADMS systems from Russia.

As to delivery prospects to China of Su-35 fighters, I can tell the following. In 2011, the Chinese Party expressed readiness to acquire a certain quantity of those planes and approached us with a relevant proposal. Now, this issue is studied by the Russian authorised organisation.

16. Are any negotiations for delivery to Vietnam a new batch of Russian S-300PMU-1 air defence missile system and Su-30MK2 fighters carried on?

Official requests from Vietnam on delivery of new S-300PMU1 air defence missile systems and Su-30MK2 fighters have not arrived.

17. Malaysia announced its intention to buy another squadron of Su-30MKM. Are any negotiations in this respect carried on?

First of all, I would like to underline that the Malaysian Party has not announced any intention to buy another batch of Su-30MKM airplanes. This sort of messages appeared in the mass media after the visit of the Minister of Defence of Malaysia to Russia and his visit to the Irkutsk aviation factory. Those publications do not represent the facts.

As it is known, Malaysia plans to buy a squadron of multirole fighters. A decision on the type of planes will be made by results of the international tender to be opened this year, and Russia along with the American and European manufacturers plans to take part in the tender. Taking into account the experience available with the Royal Air Forces of Malaysia in operating Russian aircraft, I believe that we have quite good chances to win this tender.

18. As it is known, Russia has bought from France two Mistral helicopter carriers. When building of these ships will begin? At what stage are negotiations for the purchase, to be exact, building of another two helicopter carriers on the Russian shipyards?

Countdown of the contractual term of building 2 amphibious transport docks started 1 November 2011. 1 February 2012, the shipyard of the STX French company in France’s Saint-Nazaire featured a solemn ceremony named «First steel cutting» for the hull of the 1st amphibious transport dock. Negotiations for building on the Russian shipyards 3 and 4 Mistral-type amphibious transport docks will pass to practical discussions upon a relevant decision made by the Ministry of Defence of the Russian Federation.

Date of publication: 28.03.2012




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