By Yury Lyamin
The market for modern military equipment has always been closely linked to big politics. In the case of military aviation, the influence of politics is even more significant, since the range of countries that are capable of producing military aviation equipment and especially fighter planes is very narrow. At the same time, the high cost of aircraft and helicopters, as well as aviation weapons, makes this segment of the market one of the most attractive.
One example is Iran, which before the 1979 revolution was actually a privileged client of the American aircraft industry. Wealth and close relations with the United States allowed the shah to buy hundreds of new American planes; for example, Iran became the only foreign buyer of F-14A fighters.
The Islamic revolution radically changed the situation. The new revolutionary leadership of the country was hostile to the United States, and inherited from the Shah's regime all the previously supplied American weapons. But because of sanctions imposed by the United States, Iran has lost the ability to purchase spare parts for purchased equipment and receive technical assistance from manufacturers.
The Iranian example perfectly demonstrates the political risks associated with the purchase and sale of military equipment, both for the seller and the buyer. Of course, the buyer always takes the greatest risk, which forces them to carefully choose the supplier.
Large contracts often serve to strengthen ties and alliances between countries. Predominantly choosing the weapons of one country, the buyer shows his preferences and in turn expects the seller’s support on various issues.
The international sanctions imposed on some countries, as well as unilateral restrictions on the part of leading sellers, have a serious impact on the arms market.
Among the former republics of the USSR, those that have retained allied or friendly relations with Russia are focused on continuing military and technical cooperation with our country. First of all, this naturally applies to the allies of the Collective Security Treaty Organization (CSTO). The CSTO, in addition to Russia, now includes Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Tajikistan.
These countries can receive military assistance and rely on preferential terms for the purchase of weapons. Now, following Russia, two allied countries have begun renewing their military aviation – Kazakhstan and Belarus.
For the air defense forces of Kazakhstan in 2014–2015, contracts were signed for the purchase of 11 Su-30SM, and as early as 2017 it became known that a new framework contract was being signed for the purchase of another 12 Su-30SM. Mi-35M attack helicopters and Mi-171Sh military transport helicopters are also being purchased. In the near future, most likely, we can expect further purchases of combat aircraft and helicopters.
The Republic of Belarus in recent years has bought eight Yak-130 combat training aircraft and 12 Mi-8MTV-5 helicopters. The country is planning to further update its Air Force, so in 2017 it became known that a contract was signed for the purchase of 12 Su-30SM fighters.
Among the non-allied former Soviet republics, the greatest activity in the 2010s was shown by Azerbaijan, which for various power structures acquired several dozens of Mi-35M and Mi-17-B1.
Most of the purchases of these countries are dictated by a mixture of political and economic reasons, as well as the state of the aircraft fleet of the former USSR. But it is clear that for political reasons it is absolutely impossible to cooperate with Ukraine.
In turn, the US and Canada, as well as most of the countries of Europe, are part of the NATO bloc (or candidates for membership). Their market was previously oriented to sell equipment of American or European production, but after the introduction of Western sanctions against Russia, it is now completely closed.
This factor has played a big role in the supply of helicopters to Afghanistan. Due to lack of funds from Kabul, purchases are made by the United States, and between 2011 and 2014, the U.S. purchased 63 Russian Mi-17V-5 helicopters for Afghan government troops. But against the backdrop of the anti-Russian policy of the United States, and sanctions imposed since 2014, further purchases of helicopters have become impossible. Now in Washington they plan to supply the Afghan Air Force with UH-60A helicopters from the U.S. Army.
The only European client outside the CIS seriously interested in Russian military aircraft technology is Serbia, which officially opposes NATO membership. However, the financial capabilities of the country do not allow for any serious purchases for the Serbian armed forces.
The largest acquisition of Serbia in recent years was the agreement signed in 2016 on the free transfer of six MiG-29/MiG-29UB fighters from the Ministry of Defense of Russia within the framework of military-technical assistance. Serbia will pay only for their repair and modernization, together with the modernization of the four remaining Serbian MiG-29s. Shortly before this, for the first time since the breakup of Yugoslavia, Serbia bought two Mi-17V-5 helicopters.
Traditionally, the main market for our weapons is Asia. Large-scale Chinese and Indian contracts for Su-27 and Su-30 fighters, military transport helicopters of the Mi-8/17 family, etc., helped many Russian enterprises of the aviation industry to make it through the difficult times of the 1990s and the early 2000s.
The conclusion of the first contracts with China in the early 1990's became possible due to fundamental political changes. Moscow and Beijing have ceased to see the enemy in each other and began again to form close friendly relations between countries.
At the same time, Western sanctions were imposed on China after the events in Tiananmen Square in 1989, which prohibited the supply of arms, and these sanctions are still in force.
It was the PRC that became the first overseas buyer of Su-27 fighters, and then China acquired a license for their production under the name J-11. In total, more than 280 Su-27/Su-30/J-11 fighters were supplied and assembled in China under license from supplied sets.
Cooperation was not limited to the purchase of finished aircraft and technology. Russian specialists were also involved in individual jobs at various stages of China’s aircraft development. For example, specialists of the Kamov design bureau in the mid-1990s created a preliminary design of the attack helicopter for a Chinese order. This preliminary design was used in the further development of the Z-10 attack helicopter in China.
As our own aviation industry developed, there was a natural process of China's winding down purchases of finished aircraft in Russia. Since the mid-2000's, only one contract has been signed for the purchase of combat aircraft – the contract signed in 2015 for 24 Su-35 fighters, and the prospects for new contracts look very slight.
Fearing a shortage of heavy military transport aircraft, China until recently purchased Russian Il-76 aircraft. However, now China has started the production of its own heavy class aircraft, the Y-20, and the prospects for new supplies in this area also look slim.
At the same time, the People's Republic of China continues to acquire our medium and heavy multi-purpose and transport helicopters, primarily the Mi-171. They are in consistent demand in China, as domestic production of such helicopters is not robust enough to meet all needs. Moreover, the main efforts of Chinese helicopter manufacturers in recent years have been directed at supplying PLA army aviation with Z-10 attack helicopters and light combat Z-19 helicopters.
For this reason, the joint project of the heavy helicopter Advanced Heavy Lifter, on which Russian Helicopters and the Chinese AVIC signed a cooperation agreement in 2016, looks promising. With a supposed maximum take-off weight of 38 tons, the helicopter will occupy a niche between the Mi-171 and the Mi-26, and a practical ceiling of 5,700 meters will allow it to be operated in mountainous regions where the Mi-26 cannot be used.
Since Soviet times, India has had friendly relations with our country, and for decades has been one of the largest buyers of arms, first from the USSR and later from Russia. At the same time, India has always tried to diversify sources of armaments and conducted purchases in different countries.
Of course, there are changes. If, earlier, India bought British and French equipment from Western countries, now the US is actively entering the Indian market. But even with this factor in mind, the acquisition of new Western technology by India should not surprise anyone.
Yet most of the Indian military aviation fleet is composed of Soviet and Russian aircraft and helicopters. The core of the Indian Air Force is formed by Su-30MKI fighters. The first contract for the delivery of the Su-30MKI was signed in 1996, and after signing of the next contract in 2012, the number of Su-30MKI aircraft ordered by India exceeded 270, of which more than 230 were supplied or assembled in India from supplied sets.
For the India’s navy, 45 decked fighters MiG-29K/KUB were purchased, the last of which were delivered last year. In addition, India is now completing the modernization of the old Indian MiG-29 to the MiG-29UPG under a contract from 2008.
Like China, India continues to buy Russian Mi-8/17 helicopters. Last year it was announced that a contract for the supply of 151 Mi-17V-5 has been fulfilled, and the purchase of another 48 helicopters is possible. In total, more than 400 Russian helicopters are operating in India. In addition, in 2016, there was an agreement on the purchase of 40 light multi-purpose Ka-226T helicopters and licensed assembly in India of another 160 helicopters.
The most ambitious joint project is the Russian-Indian program to create a fifth-generation FGFA fighter. The fighter is developed on the basis of the Russian PAK FA.
The implementation of the FGFA program will ensure the needs of the Indian Air Force for decades to come, but a serious problem may be the issue of transferring the latest technologies to the Indian side. India is trying to establish independent manufacture of fighters in the framework of the Made in India policy, but the potential transfer of key technologies and the complete localization of production might lead to step increases in the cost of the FGFA.
It seems that the issues of price and technology transfer are causing a delay in the signing of the final contract for the development of the FGFA project. After all, the intergovernmental agreement on FGFA was signed ten years ago, and the contract for the development of a preliminary technical project, in 2010.
Speaking about India, it is impossible to forget about neighboring Pakistan. Here we are facing a case of a serious self-restriction of military and technical cooperation on the part of Russia for the sake of maintaining its special relationship with India. The supplies of the Russian aviation materiel to Pakistan are confined to Mi-17 helicopters and a recently concluded contract for four strike Mi-35М helicopters.
South-East Asia is quite a big market for the Russian aviation materiel. First and foremost, Vietnam stands out, as a country with longstanding relations, as one of the biggest buyers of the Russian armaments.
The Air Force of Vietnam is made up of Soviet and Russian equipment, and between the years of 2014 and 2016 alone, Vietnam procured 36 Su-30МK2 fighters. Despite separate procurements in other countries, one may expect that Vietnam will further acquire Russian planes and helicopters.
Myanmar is a significant buyer, since in the early 2000s it procured 32 MiG-29 of different modifications according to two contracts, and in 2015, it ordered Yak-130. In addition, Myanmar has procured Mi-35P and Mi-17 helicopters.
It is possible to distinguish Malaysia, Bangladesh and Indonesia among other notable clients of our aviation industry in this region. So, Su-30МKМ and MiG-29N fighters are in the inventory of the Malaysian Air Force, the Air Force of Bangladesh includes MiG-29 fighters, Yak-130 combat trainers and Mi-17/Mi-171Sh helicopters. As for Indonesia, the Air Force of this country is equipped with Su-27 and Su-30МK2 fighters and negotiations are underway about the possible procurement of Su-35 fighters.
Here, we have no political restrictions, but the market of the region’s countries features a high level of competition with Chinese and Western manufacturers, while the Air Force itself is quite small.
Unfortunately, owing to various political reasons we have an insufficient access to the markets of the Middle East countries. Other than Egypt, the only big buyer of aviation materiel there in the recent years was Iraq, which has bought our Mi-28NE, Mi-35М strike helicopters, Мi-171Sh transport helicopters and used Su-25 attack planes.
Because of the war in Syria, contracts for supplying MiG-29М/М2 and Yak-130 have been essentially frozen. Given its difficult financial situation, Syria will be able to buy combat planes individually, and their acquisition will only be possible as military assistance or on credit.
The war in Yemen has disturbed a military and technical cooperation with this country, too; it has also been a long-time buyer of Russian military equipment and, for instance, acquired MiG-29 in 2000s.
Iran, which desperately needs to upgrade its Air Force, cannot buy combat planes, helicopters, tanks and a great number of other armaments until 2020. Formally, all international sanctions were lifted in 2015, but Resolution 2231 established that the supplies of the above armaments in the subsequent five-year period can be only carried with the consent of the United Nations Security Force, which is impossible because of the position of the United States and its allies.
As for the Arab monarchies in the region, they traditionally buy Western military aviation equipment. The Arab monarchies might be interested in, and even purchase, Russian air defense systems, as well as some models of armaments and equipment for the ground forces, but the attempts of Russia to enter these markets in earnest failed in the sphere of military aviation.
It should be taken into account that multibillion orders in the USA and Europe are used by Saudi Arabia and other monarchies as a kind of tool for exertion of political influence and close liaisoning with American and European elites. As we already pointed out, aviation is one of the most attractive and expensive segments of the armaments market.
In this respect, negotiations about possible supplies of Su-35 to the UAE and the concluded agreement on the joint development of the light five-generation fighter look interesting. It should be underlined that these developments are at the stage when the parties are only preparing and discussing proposals. No contracts have been signed so far and the real implementation of intentions may never be reached.
Algeria and Egypt are the biggest buyers of Russian combat planes and helicopters among African countries.
Algeria is another country that has enjoyed close military and technical cooperation with Russia since Soviet times. Even the well-known scandal of the second half of the 2000s involving the return and breach of contract for MiG-29SМТ fighters, for which sub-standard components had been used during manufacturing, did not interfere with the development of this cooperation.
Beginning in 2006, Algeria has procured a total of 58 Su-30МKАs, the last of which are due to be delivered this year. In addition, 16 Yak-130s have been acquired and contracts are being fulfilled to supply 42 Mi-28NE strike helicopters and fourteen transport Мi-26 helicopters to Algeria.
The deliveries of new types of planes such as Su-34 fighter-bombers are possible in the nearest future.
Military and technical cooperation with Egypt since the middle of the 20th century has survived its ups and downs depending on changes in the country’s political course. Now it is on the rise. Egypt has procured more than 50 MiG-29М/М2 fighters and 46 Ka-52 strike helicopters within the last couple of years alone, and other contracts are possible.
Libya, too, could be a potentially big client, but after the ouster of Qaddafi in 2011, a civil war broke out in the country among the victors. The war continues to this day, and the restrictions for the supply of armaments still persist with respect to Libya.
Sudan is an active buyer of aviation equipment, but it prefers to buy inexpensive machines, most frequently used equipment. Morocco, on the contrary, like other Arab monarchies, traditionally prefers Western planes and helicopters.
The majority of African countries, especially those situated south of the Sahara, make up an insignificant part of the world arms market. The economic situation in many of these countries makes it impossible for them to plan large-scale purchases, and they prefer cheapest and least complicated planes and helicopters.
Helicopters are the most popular Russian equipment in these countries. For instance, a 2014 contract with Nigeria is being fulfilled now; the country has procured 12 Мi-35М helicopters, as well as Мi-171Sh helicopters, while Mali has received two Мi-35М helicopters under a 2016 contract.
Two contracts for buying combat fighters stand out against this background. They are the purchase of six new Su-30МK2 fighters by Uganda several years ago, and the procurement of 12 former Indian Su-30Ks by Angola, including their repair and upgrading at the aircraft overhauling facility in Baranovichi (Belarus).
Moving on to the markets of Latin America, we should note that we have long-standing military and technical cooperation there with only Cuba, Peru, and Nicaragua. However, Peru alone among these countries has funds for more or less large purchases of military aviation equipment; so, beginning in 2010, that country has procured 30 Мi-171Shs and two Мi-35Ps.
Beginning in the 1990s, national aviation equipment has managed to enter the market of such American countries as Brazil, Columbia, etc. However, as with Africa, they show the most interest in Mi-17 helicopters, and Mi-35 to a lesser degree. For instance, Brazil received 12 Мi-35М helicopters according to a 2008 contract.
Venezuela has become a key partner of Russia in this part of the world since the early 2000s. A socialist government charted a foreign policy course towards cooperation with Russia and China, which has reflected in aviation, too. Beginning in the mid-2000s, Caracas has acquired 24 Su-30МK2 fighters, ten Мi-35М, 34 Мi-17V-5 and three Мi-26Т helicopters.
The possible supply of ten more Su-30s was discussed in recent years, but the difficult economic and political situation in Venezuela makes the signing of new contracts difficult.
In summary, political factors play an enormous role in the sales of military equipment and, especially, combat aviation. Most frequently such factors outbalance the economical and technical ones, which directly affect the sales of the Russian aviation equipment in different regions of the world.
