#11 - RW 268
Gazeta
August 5, 2003
FIGHTERS TO BECOME THE BASIS OF RUSSIAN ARMS EXPORTS
An update on Russian arms exports
Author: Ivan Yegorov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]

AIRCRAFT ACCOUNTED FOR 75% OF ARMS EXPORTS IN 2002 (CONVENTIONAL ARMS FOR 14.8%, NAVAL HARDWARE FOR 6%, AND AIR DEFENSE WEAPONS FOR 4%). AS BEFORE, THE MAJOR BUYERS ARE CHINA (58%) AND INDIA (28%). THE LIST OF OTHER MAJOR IMPORTERS INCLUDES KUWAIT (4%), CYPRUS (3%), AND VIETNAM (1%).

Fighters will remain the most in-demand military hardware Russia sells abroad in the next seven years. Experts at the Strategy and Technology Analysis Center say that Russia can export $8-9 billion worth of fighters by 2010. The sum is considerable, particularly since the whole portfolio of Rosoboroneksport (Russian Arms Exports) to 2012 is evaluated at $13.5 billion. Unfortunately, however, the Sukhoi fighter may remain the only Russian aircraft on the world market.

Aircraft have accounted for 50% of Russian arms exports for these last five years, and the trend will remain unchanged in the near future, says Ruslan Pukhov of the Strategy and Technology Analysis Center. Aircraft accounted for 75% of arms exports in 2002 (conventional arms for 14.8%, naval hardware for 6%, and air defense weapons for 4%). As before, the major buyers are China (58%) and India (28%). The list of other major importers includes Kuwait (4%), Cyprus (3%), and Vietnam (1%).

Russia sold $4.8 billion worth of arms to foreign customers in 2002 and became the second largest arms exporter in the world, after the United States.

According to Pukhov, Russian arms exporters may sell up to 190 multipurpose fighters, for $8-9 billion, by 2010. This sum is about twice the value of total annual arms exports. Supposedly, 24 SU-30 fighters will be sold to Vietnam, eight to Indonesia, 24 to China, and ten to India. Russia may even win the contest for the privilege of selling 24 aircraft to Brazil.

As for MIG-29 multipurpose fighters, 30 may be delivered to Africa, 20 to Latin America, 20 to the Mideast, and 20 to Near East. Thirty more aircraft may be sold to India for the Admiral Gorshkov aircraft carrier (according to what information is available at this point, the $1 billion contract with India may be signed this autumn, after years of negotiations).

Sukhoi Aviation remains the leading aircraft exporter, and MIG's major rival.

Russia's obligations to China by the end of 2002 included deliveries of nineteen SU-30MKK and systems for licensed production of between 180 and 185 SU-27SK aircraft. Moreover, 76 SU-27SK and SU- 27BK, 57 SU-30MKK, and systems for licensed production of SU-27SK aircraft in Shengyang. Future contracts may include production of about 200 SU-27BK and SU-30MKK fighters.

By the end of 2002 the Indian Air Force received eighteen SU-30K, ten SU-30MKI, and ten MIG-29 aircraft. The remaining contracts include delivery of 22 SU-30MKIs and licensed production of 140 aircraft. Ten SU-30MKI may be delivered to India additionally.

The Sukhoi reported revenues amounting to $988 million in 2002, MIG only $267 million. Experts call even this figure a breakthrough for MIG, which was only the thirteenth largest arms exporter in 2001. Increased revenues are attributed to starting shipments of the portfolio accumulated in 2001 (to the tune of $952 million). Experts say, however, that even this sum will not suffice to ensure the financial recovery of the company.

(Translated by A. Ignatkin)

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