Category Archives: Arms Sales

Taking Stock of Russian Acquisition

Novyye izvestiya interviewed Ruslan Pukhov last week.  He has some perspectives on Russian military procurement we’ve heard before, and some we haven’t.

NI asked the CAST director if the U.S. Tomahawk strike on Shayrat would hurt Russia’s exports of air defense systems.  He said no, for all the obvious reasons.

More interestingly, Pukhov said air defense equipment typically represents 10-20 percent of Russia’s annual arms exports.  This could rise in coming years, he stated, due to future sales of the S-400 to “China and other countries.”

Ruslan Pukhov

Ruslan Pukhov

Asked how Russian weapons have performed in Syria, Pukhov responded:

“The Syrian campaign has made a good advertisement for Russian arms, particularly for new types of Russian combat aircraft (Su-30SM, Su-35 and especially Su-34) and helicopters (Mi-28N and Ka-52), but also for precision munitions — cruise missiles and aircraft ordnance.  Therefore it’s possible to expect growing interest from foreign buyers and growing sales in these segments.  The negative side one can draw from the actions of the Russian grouping in Syria is, first and foremost, the insufficient capability of its technical reconnaissance systems, including unmanned aerial vehicles and space systems.  The quantity of precision weapons is still insufficient.  The precision arms themselves in a number of cases require additional development.  There is still a lot of work ahead, but the main thing is that the Syrian campaign has allowed for revealing these deficiencies and partially eliminating them.  Meanwhile the cost of acquiring this priceless experience has been relatively low.”

Of course, the cost is only low if you’re not in the crossfire in Syria.

NI asked Pukhov if Russian weapons are better today or are they still based on old Soviet ones.  He answered:

“There is progress, but a large part of equipment, including what is being produced and bought now, still depends precisely on the Soviet legacy.  The weapons systems of a really new generation (the T-50 fighter, ‘Armata’ tank, new generation armor) remain in development and still haven’t gotten to the serial production stage.  But we have to understand that the creation of new generation armaments in any case involves many years – the cycle is 10-15-20 years from the start of R&D to the real achievement of combat capability in series models in troop units.  Considering that in Russia significant financing of defense and the OPK began only after 2005, and on a really large-scale only after 2010, then you really can’t expect any other result.  If there’s success in financing at the necessary level, then after 2020 the arrival of platforms and systems of a really new generation will begin.”

And how have economic problems and sanctions affected the OPK?

“The crisis still doesn’t directly affect the OPK.  Even with a sharp contraction in federal budget revenue and eight years of economic stagnation, state defense order financing has been preserved at a high level, and it will begin to drop only from 2017.  But not because of economic difficulties, but in connection with saturating the troops with new and modern equipment.  From another side, sometimes the conditions of GOZ price formation turn out so severe for enterprises that it sometimes leads to GOZ contracts being fulfilled at the limit of profitability.”

“The full action of sanctions began to be felt from 2015.  Because the non-supply of a number of components from Ukraine and Western countries already caused a shift in the completion of a number of programs, the most well-known instances are connected with the construction of project 11356 and 22350 frigates, but also project 20385 corvettes, on which Ukrainian gas turbines and German diesels, in turn, were replaced.  In addition, sanctions complicated the purchase of Western-produced equipment by Russian enterprises, and, most importantly, its licensed maintenance. And as practice has shown, analogues from China and other countries don’t always meet the quality standards we need.  By 2018, the import substitution program will allow for covering 80-90% of imported items, and finally, imports will be replaced by 2020.”

What’s It Cost? (Part III)

48N6E2

48N6E2

We might never be done with this topic, and that’s OK.

On 17 March, TASS reported that Russia will sell China two “regimental sets” of S-400 Triumf surface-to-air missiles in a deal reportedly worth $3 billion.

The first will be delivered in December 2017-January 2018 and the second in May-June 2019, according to the news agency’s “military-diplomatic source.”

Moscow and Beijing signed the S-400 contract in September 2014.

Each “set” has two battalions of four S-400 launchers.  Or a total of 16 launch vehicles.  Or 64 missiles and an unreported number of reloads.

Recall that previous reports claimed China was after no less than six S-400 battalions for that same $3 billion price.

The September 2014 deal includes training for Chinese personnel beginning in the last quarter of 2017, according to TASS.

Its source also stated that the first “regiment” will have the same missiles as the S-300PMU-2 SAM systems China already has.  The 48N6E2 with its 200-km range.

The second will have missiles “with improved characteristics.”  Presumably, the newer 400-km 40N6E.

But it’s not clear that the 40N6 (or export-version 40N6E) missile is fully out of testing, if some press reporting is accurate.

China is, of course, the first foreign customer, but India will apparently be the second.  According to RIA Novosti, India is negotiating for five S-400 battalions for a reported $5.8 billion.

However, it seems unlikely New Delhi would pay that kind of premium for a fifth battalion, even with all 40N6E missiles.

Still Awaiting New GRU Chief

On 13 January, Kommersant’s Ivan Safronov wrote that late GRU Chief General-Colonel Igor Sergun’s successor will be one of the military intelligence directorate’s current deputy chiefs:  Vyacheslav Kondrashov, Sergey Gizunov, Igor Lelin, or Igor Korobov.

General-Lieutenant Vyacheslav Viktorovich Kondrashov reportedly headed a Russian delegation that went to Cairo on an arms sales mission in late 2013.  He is likely a Middle East specialist and Arabic linguist.  He’s an old hand at the GRU headquarters.  It looks like he put on his first star over 20 years ago.  He seems like a timely choice from the GRU’s perspective, but he might not serve much longer.

Sergey Aleksandrovich Gizunov is probably a computer expert or mathematician from the GRU SIGINT apparatus.  He was chief of the Moscow-based 85th Main Center of Special Service which deciphers foreign military communications.  He’d be an unusual pick for an intelligence service that likes experienced field operators at the top.

General-Major (???) Igor Viktorovich Lelin was Russian military attache to Estonia and served for a time as deputy chief of the Defense Ministry’s Main Personnel Directorate (GUK).  He only returned to the GRU in 2014.  Lelin doesn’t seem to have much to recommend him, at least based on what little is known of his background.

Igor Korobov seems to have no information in the public domain.  Safronov’s sources call him a “serious person” and the most probable candidate to take Sergun’s chair.  Although it’s ironic, one has to agree that the lack of data on Korobov makes it utterly impossible to dismiss him as a strong possibility.

According to Safronov, the GRU bureaucracy feared having an outside chief (from the FSO or SVR) imposed upon it following Sergun’s untimely death from a heart attack in the Moscow suburbs on 3 January.  Speculation focused on one former presidential bodyguard named Aleksey Dyumin who quickly turned up as a deputy minister of defense.  So the worry may have passed.  The Genshtab and Defense Ministry now believe the PA will settle on an insider to keep continuity in this important agency.

Ten days ago an ukaz indicating President Putin’s choice was expected “soon,” but no sign of it yet.

Safronov makes the point that the GRU has been busy because of Russia’s operation in Syria.  Its IMINT and SIGINT systems, not to mention its human agent networks, have been working overtime to support Russian military and political decisionmakers.  The GRU also played a critical part in Russia’s invasion of Crimea and eastern Ukraine in 2014.

Just as post-script, we’ve seen in the last day the Financial Times report that Sergun visited Syrian leader Bashar al-Assad to relay Putin’s request that he consider stepping down.  Of course, the Kremlin denied it, but remember Putin said earlier this month that giving Bashar asylum would be easier than Edward Snowden.

What’s It Cost? (Addendum)

There’s reason this week to return to the issue of what the S-400 system costs. Specifically, what it might cost China.

Vedomosti reported Wednesday that Russia has signed a deal with China to sell it the S-400 / Triumf.

The business daily’s defense industry source claims the agreement inked by Rosoboroneksport and the Chinese military will send off not less than six battalions of the advanced SAM system for more than $3 billion.

That would be at least $500 million per battalion (against the previously ventured guess of about $320 million).  Or in excess of $80 million per TEL.

The Russian Defense Ministry has consistently maintained that the S-400 won’t go abroad before 2016.

Vedomosti notes China’s last big purchase was 15 battalions of S-300PMU-2 completed in 2010.

RIA Novosti pretty quickly reported that an official of Russia’s Federal Service for Military-Technical Cooperation (FSVTS) said an S-400 contract hadn’t been signed with China as yet.

Rosoboroneksport and Almaz-Antey just declined comment.

The Next China Deal

IA Regnum military observer Leonid Nersisyan recently took a stab at preparing Russian public opinion for the eventual sale of S-400 SAMs and Su-35S fighters to China.  A major arms deal with China should be expected, especially given Moscow’s turn further east in the wake of Western sanctions.

Nersisyan aims to refute usual complaints about exporting Russia’s most advanced weaponry to China, i.e. that Beijing will quickly copy and sell it more cheaply.  He dials back to the early 1990s.

The sale of S-300 SAMs began in 1993, amounting to something between 24 and 40 battalions of three variants.  Along the way, China developed a copy, the HQ-9, similar but less capable than the original in many performance parameters.  If it had been a really good knock off, Nersisyan argues, the HQ-9 would be found in many of the world’s armies, but it isn’t.

China's S-300, Whitewalls on a TEL?

China’s S-300, Whitewalls on a TEL?

The S-300 has grown old, and the money earned from China went into S-400 development and saved Almaz-Antey from bankruptcy at a time of little, if any, Russian military procurement.  Nersisyan concludes that:

“. . . the deal was successful — the system was copied (with deficiencies) only two decades after the first deliveries, when it had already grown old, and Russia had more modern analogues.”

Nersisyan points also to the Su-27 sale.  First Russia sold Beijing 24, then 200 kits for assembly in China.  But the Chinese stopped the transfer at 100, and began producing a copy, the J-11B.  However, its engine proved unreliable in comparison with Russia’s AL-31F, which the Chinese opted to buy for their domestic fighters.  Similarly, China bought nearly 100 Su-30 variants beginning in 2000 before producing a copy, the J-16, which also lacks a reliable engine. China’s difficulty, according to various reports, is manufacturing turbine blades and plates.

Neither the J-11B nor the J-16 is being produced in volume, and Russian aircraft remain the foundation of Chinese fighter aviation.

So, concludes Nersisyan, it will take China 20 years to copy the more complex S-400, while Russia is deploying the S-500.  Copying the generation 4++ Su-35S will be complicated by its more advanced thrust-vectored AL-41F1S engine, and Russia will be fielding the PAK FA / T-50 in the meantime.

Nersisyan writes that becoming a real competitor in the global arms market requires original RDT&E, not copying.  He sums up in three maxims:

  • Modern technologies don’t lend themselves to quick copying.
  • Copiers always lag behind.
  • The copy is often worse than the original.

What do others say about the threat of Chinese copying?

CAST’s Vasiliy Kashin agrees that fears are exaggerated because people don’t understand the obstacles to successful copying or that China’s military modernization is directed against the U.S. (something that, he adds, benefits Moscow).  He also blames much of the copying of Russian fighters on Ukrainian technical cooperation with China.

Vasiliy Sychev has written that S-400 and Su-35S sales to China will be straight sales without any technical or production licenses.  Moscow typically wants to sell more, and Beijing buy less, but the sides have worked toward the middle.  A new deal (or deals) will be for 2-4 SAM battalions and 24 fighters ($1.5 billion, or $60 million per).

Nor does Viktor Murakhovskiy see anything critical because Russian capabilities will be ahead of what China gets.

More Sinophobic, Aleksandr Khramchikhin says there’s an active and effective pro-China lobby in Moscow’s power ministries and OPK, and he believes Russia needs to understand it faces a grave threat from China.

Mistrals Not Needed

It’s possible the endgame for the Russian Mistrals is approaching.

First Russian Mistral at DCNS (photo: RIA Novosti  / Daniil Nizamutdinov)

First Russian Mistral at DCNS (photo: RIA Novosti / Daniil Nizamutdinov)

But Moscow’s not sad.  Officials have already said it’s not a tragedy.

Mikhail Nenashev — not an official, but a former Duma member and well-informed commentator — has called into question the need for the Mistrals. He’s a former Captain First Rank who chairs the All-Russian Movement for Support of the Navy.

According to RIA Novosti, he said the Mistrals have no utility but political.  The news agency quotes Nenashev:

“These ships are no kind of necessity for the navy — we don’t intend to land troops in such a way.  As I recall, the French themselves earlier and now are searching for how to deploy these ships — for a decade of fulfilling these missions by the French Navy there were few places where these ‘Mistrals’ were deployed in reality.”

That’s a bit of an exaggeration.  The most cursory look shows that the French contributed the Mistrals to the NATO Response Force, and deployed them during unrest in Lebanon and Cote d’Ivoire, among other places.

Nenashev and others (including Minister of Industry and Trade Denis Manturov) say Russia can build ships like to the Mistrals since it was already participating in their construction, and providing the internal command and control systems for the ships.  It would take longer (3-4 years) but cost less (€150-200 million vs. €1.2 billion).  The French, he says, can build it in a year because they have a smooth production process for these ships.

The former officer suggested that Sevmash or Baltic shipyard could construct such a ship if desired.  But he fails to note that these builders are already absolutely chockablock with orders today, and every new ship type is taking substantially more than 3-4 years to build.

But Nenashev willingly admits there are “acute questions” about the shipbuilding industry.  Specifically, issues of components, parts, technology, and skilled labor are a “little rough” and require coordination.

It’s exactly what Moscow will miss — a chance to see first-hand how fairly robust and modern French shipbuilders do their work.  No doubt there are things the Russians could have learned and taken home.

For their part, the French carefully note that the delivery of the first Russian Mistral has not legally and finally stopped. But President Hollande signaled Moscow that, if the situation in Ukraine does not improve, he will not approve the ship’s transfer in November.  That final decision will actually come at the end of October.

Improvement in Ukraine is defined by a relatively high bar of an effective ceasefire and agreement on a political resolution of the conflict.

The Elysee is quick to repeat that the Mistral sale remains unaffected by EU sanctions on Russia, and is a decision for Paris to make.  Hollande adopted his current stance in the last couple weeks as unavoidable evidence of direct Russian participation in the fighting (i.e. POWs and KIAs) in eastern Ukraine surfaced.

As of 9 September, RIA Novosti reported that planned at-sea training for the first Russian Mistral and its 400-man crew-in-waiting in Saint-Nazaire was put off for “technical reasons” having nothing to do with the French President’s current stance on the sale (or no sale).

SIPRI’s List

Always worth looking at SIPRI.  On 31 January, it released its list of the Top 100 arms producers worldwide in 2012 and 2011.

SIPRI observed a small global decline in arms sales over the past two years.  But Russia bucked the trend as “arms sales by Russian companies increased sharply, by 28 per cent in real terms.”

SIPRI provides the context for increased arms production by Russian companies that’s worth quoting in toto:

“Rapid rise in Russia due to domestic procurement plans”

“Russian companies saw a particularly large increase in estimated arms sales in 2012. Of the 6 Russian companies in the Top 100, all except United Aircraft Corporation saw increases in excess of 20 per cent, and Almaz Antei—with a 41 per cent rise—now stands in 14th place in the Top 100, the highest position taken by a Russian company since data became available in 2002.”

“Russian arms companies continue to maintain high export levels, but the increase in estimated arms sales in 2012 mainly reflects large and growing domestic sales, as part of Russia’s $700 billion 2011–20 State Armaments Plan. While there remains widespread scepticism as to whether the aims of the plan can be fully achieved, it is clear that a major increase in Russian military equipment procurement is taking place.”

“‘The Russian arms industry is gradually re-emerging from the ruins of the Soviet industry’, said Dr Sam Perlo-Freeman, Director of SIPRI’s Military Expenditure and Arms Production Programme. ‘Nonetheless, the industry is still plagued by outdated equipment, inefficient organization and widespread corruption, which will continue to limit Russia’s ability to compete technologically with the West.’”

So, it’s not just that Rosoboroneksport’s order portfolio is stuffed full.  But SIPRI sees both good and bad news for Russian defense industry and production.

The top Russian firms on this year’s list are:  Almaz-Antey, UAC or OAK, Vertolety Rossii (Oboronprom), Sukhoy (UAC / OAK), United Enginebuilding Corporation, UEC or ODK (Oboronprom), USC or OSK, and Uralvagonzavod.

Falling off from 2010’s list are Irkut and MiG (UAC / OAK) and the Tactical Missile Weapons (TRV) Corporation.

Some changes may be the result of data collection problems SIPRI faces.

Here’s SIPRI’s data on arms sales by Russia’s top producers.

SIPRI Data on Arms Sales by Top Russian Producers

Pretty interesting stuff.  Strong and stable growth by Almaz-Antey.  Steady growth for UAC / OAK and Sukhoy.  Remarkable growth by Vertolety Rossii — quadrupling its sales in three years.  Ditto for UEB / ODK — nearly quadrupling.  Even Uralvagonzavod doubling its sales over the same period.