Russian officials have been irritated for years by what they view as Chinas illegal reverse engineering of combat systems. After selling a few systems to China, Russia had counted on follow-on orders for more systems, which is the ethical business practice of other nations. In addition to costing Russia the loss of future sales to China, Chinese copies compete with Russia in sales to other Third World navies. China in turn has complained that Russia has overcharged it for ships and systems that were sold for less to other nations
The Russian state military import/ export agency Rosvoorouzhenie and 956E production Severnoye Design Bureau were shocked and angered when the 054A upgrade to the new Peoples Liberation Army Navy (PLAN) 054 frigate appeared in 2006 (SIGNAL Magazine, May 2007). At first it appeared to have four Russian-supplied systems that had been on earlier Chinese Luyang guided missile destroyers (DDGs). In reality, the four complex systems were illegal Chinese copies never before seen, and all were on a new serial production series of frigates. This was the straw that broke the bears back, and it could result in Russia shifting high-technology exports from China to India.
The Sovremennyi high-technology combat systems copied by China on the surprising 2006 054A upgrade may seriously disrupt future high-technology imports to China by Russia. The four copied systems are the MGK-335 sonar, the Fregate M2EM three-dimensional (3-D) radar, Mineral ME (Bandstand) tracking radars and the Russian MR90 missile guidance tracker-illuminator for the SAN-7 Rif-M Shtil surface-to-air missile (SAM).
The Fregate M2EM 3-D radar offers two channels in E and H bands that can track more than 100 contacts with maximum range of 300 kilometers (200 miles). The equipment and antenna weigh 6.6 tons and 2.3 tons, respectively. It was designed by Salyut Moscow and first provided to China on four 956E ships in 2000. China imported 10 sets of the Fregate 3-D radar, with two placed on 052B DDGs in 2002 and two placed on 051C DDGs in 2006. The first reverse-engineered Chinese copy appeared on the 054A frigate in 2006.
After all of these years, China still imports some SEMT and MTU diesel components from France and Germany. During 2006 and 2007, China imported 15 to 20 sets of German MTU 16-valve and 8-valve 396 SE84 diesels for new submarines such as the modern Yuan diesel boats. The same situation exists with China importing parts for 24 model 16 PA6STC diesels, which were used on the newest 054/054A frigates. Apparently China has not yet successfully produced these submarine or surface ship diesels without imported components.
Other notable Chinese PLAN reverse engineerings of foreign weapon systems include the Crotale/HQ-7/Castor C radar. Two sets of Crotale missile launchers were imported from France in the 1980s. Crotale missile launchers and associated Thomson CSF DRBC 32F Castor C fire control radars were installed on the Luhu DDG 112 in 1991. An upgraded Luda, hull 109 added a topside 8-round reload box aft of the launcher. The six Jiangwei II frigates launched from 1991 to 2000 had HQ-7 by China, with no reload storage. In 2002 the Crotale was replaced with indigenous HQ-7A on DDG 112. The 1993 Luhu DDG 113 and 1997 Luhai DDG 167 HQ-7 had reload rounds in below-deck hatches, which was not even available in French Crotale systems. .