This article clears many confusions!!
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Russia Fears Competition From Chinese Fighter Jets
Posted by Erin Sansone | July 16th, 2010 | Russia
By WENDELL MINNICK, USMAN ANSARI And NABI ABDULLAEV – Just two weeks before Beijing plans to showcase its JF-17/FC-1 multirole fighter to potential buyers, a leading executive of Russia’s aircraft industry is trying to keep the planes from getting off the ground.
In a recent letter, Mikhail Pogosyan, the general director of Sukhoi Design Bureau and Russian Aircraft Corp. (RAC) MiG, asked Russia’s Federal Service for Military-Technical Cooperation (FSMTC) to block the Chernyshyov Machine-building Enterprise from delivering 100 RD-93 engines.
“I am not against the export of separate technologies, but it should be agreed with those who make final products that such export would not harm them,” Pogosyan told the Russian business daily newspaper Kommersant on July 6.
Pogosyan fears the single-engine JF-17, which costs up to $20 million per copy, could undercut sales of the $30 million, twin-engine MiG-29 Fulcrum.
FSMTC controls and supervises military cooperation with non-Russian governments.
A senior MiG executive confirmed the sending of the letter, but would not disclose other |details.
The engines are to power the Pakistani JF-17 Thunder and the Chinese FC-1 Xiaolong (Fierce Dragon), the nearly identical aircraft developed in a joint effort by China’s Chengdu Aircraft Industries Corp. and the Pakistan Aeronautical Complex (PAC).
China plans to show two JF-17s at the Farnborough International Airshow later this month — the planes’ debut at international defense exhibitions — in hopes of drumming up export sales.
In 2005, China placed a $238 million order for 100 RD-93 engines from Chernyshyov, a Moscow-based subsidiary of the state-owned OPK Oboronprom holding company.
A contract for another 100 engines had been expected soon.
On July 6, Kommersant quoted a military industry source as saying, “The new contract with China for the sale of 100 RD-93 engines has not been signed.”
As well, China’s Guizhou Aero Engine Group is reportedly working on an alternative to the RD-93, dubbed the WS-13 Taishan.
The Russians are worried about China’s burgeoning defense aerospace industry, which is targeting markets once dominated by Soviet and Russian products.
In another demonstration of Russia’s concern over competition with China, the administration issued a July 7 tender on the state procurement website for a study on the strategy and tactics of Chinese exporters of arms and military equipment, their success and competitive advantages.
The Kremlin offers $6,500 for a research paper that will be used to prepare a report for President Dmitry Medvedev. The authors will be expected to study Russian-Chinese military and technical cooperation, including the state regulatory mechanisms, to identify factors that give Chinese exporters competitive advantages. Separately, authors of the paper should study how Chinese exporters operate in the markets that Russia traditionally considers its own.
Moreover, Russian officials say, China is doing it by intellectual theft.
At the 2009 Dubai Airshow, an official from Rosoboronexport, Russia’s state arms export agency, accused China of stealing the designs for the Su-27 (J-11B) and called China’s L-15 trainer jet a cheap copy of Russia’s Yak-130.
“Everyone in the defense industry should be concerned about the Chinese push into the market,” he said.
In China, said Dean Cheng of the Washington-based Heritage Foundation, “R&D does not stand for ‘research and development,’ but rather ‘receive and duplicate.’”
Some Chinese officials appear unconcerned over Russian complaints that China is stealing its customers.
“I hope that is the reason,” said Maj. Gen. Zhu Chenghu, director general of the Strategic Studies Department of the Chinese Army’s National Defense University.
Russia has a lot to protect. In 2009, MiG exports reached $325 million and its order portfolio now exceeds $3 billion.
Last year, the MiG-29 beat out China’s FC-1 and J-10 for a 20-fighter order from Myanmar. This year, the MiG-29 is competing against the JF-17/FC-1 for an Egyptian tender of 32 fighters.
The FSMTC has already approved the re-export of RD-93 engines if China wins the Egyptian tender.
Dmitry Vasilyev, an arms export analyst with Moscow’s Center for Analysis of Strategies and Technologies, said the JF-17’s relatively small pricetag makes it more attractive.
“Two engines needed to equip one fighter costs about $5 million, and engines usually make up about one-quarter of the total price of a fighter,” Vasilyev said.
In fact, he said, it looks as if the Chinese government is offering the fighter for less than its production cost — “dumping” them on the world’s arms market.( wheres profit margin???)
Russia and China have already clashed in the international market over air defense missile system exports. The Russian S-300 anti-aircraft system is competing with the Chinese HQ-9 system for a three-year-old Turkish tender.
Pakistan is watching the engine dispute with concern. One observer gave even odds that Pogosyan would succeed in his efforts to block the engines.
“Russian military-industrial oligarchies are powerful and have immense say in the Russian governmental structures,” said retired Pakistan Air Force Air Commodore Kaiser Tufail.
That would hurt Pakistan’s domestic fighter program, Tufail said. Waiting for the Chinese WS-13 engine would require a whole range of test trials in different configurations and could lead to a two-year delay.
It does not help, Tufail said, that “China is not going whole hog with the JF-17 for reasons of their own.”
China is not building the fighter for its own air service; that role will be filled by the more capable J-10 aircraft.
Wendell Minnick contributed to this report from Taipei, Usman Ansari from Islamabad and Nabi Abdullaev from Moscow.
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