Conquered line

Russia regained its position in the global arms market, lost after the collapse of the USSR

The system of export of domestically produced weapons, which has been constantly and steadily increasing income for all the years of its existence, will soon be 10. December 1 The Committee of the Russian Federation on military-technical cooperation with foreign states was established in 2000, which was transformed into the Federal Service for Military-Technical Cooperation (FSBTS of Russia) in 2004. This is the head structure of special export, which makes decisions on the import into and out of our country of military products. Vyacheslav DZIRKALN, Deputy Director of the Federal Customs Service, told about the current state of affairs in the field of deliveries abroad of products of the Russian defense industry complex.

- Vyacheslav Karlovich is probably the main question on the eve of the anniversary of the Federal Service for Military-Technical Cooperation: what are the results of its work over the past decade in particular and what results did Russia achieve in the MTC in general during this period?

- According to various estimates of both domestic and foreign analysts, in recent years, Russia has occupied one of the leading places on the world market for military products (PPS). Its total volume is today about 25-30 billions of dollars a year. We work in our segment, and over the past 10 years we have been increasing our supply volumes annually, and last year we reached the milestone exceeding 8 billions of dollars.

After the collapse and the crisis in our defense industry in the 90s, we can now confidently say that Russia has fully regained its position in the main world arms markets. Our main advantage is the criterion of "price-quality". Domestic weapon is in demand because it is quite easy to handle. And at the same time his combat capabilities are quite high. Taking into account lower prices than those of competitors, we have a circle of our customers, who prefer Russian armaments. The plans for the coming years - to increase exports. And since we are using not only the backlog created in Soviet times, but also actively introducing new developments, our prospects are quite good.

- By the way, some experts say that as the intellectual potential accumulated before the collapse of the USSR is spent, the export of Russian weapons will also decline, because the 90s have dealt a heavy blow to domestic industry. Is there such an effect?

- It was felt at the initial stage of the work of the VTS FS, in the early years of this century. Then the backlog, created in the Soviet era, was really in demand. But if we want to be competitive, it is necessary to offer new developments. And we have them. Moreover, recently we have been actively cooperating with foreign partners, because we understand that in some areas it makes sense to combine efforts, to take something new and interesting abroad, to be used to increase the export potential of our weapons. We work with companies from France, Italy, Israel, and quite serious contacts have been established with them.

- Is it possible that in the end we will only supply the body, and the whole stuffing will be of foreign manufacture?

- No, there is no such thing, we take only what is useful for us, in which we, maybe, have not advanced enough yet. These are separate systems, which in total volume make up no more than 10 percent of the value of the supplied product. We are not interested in exporting, say, a tank, the hull of which is made in Russia, and all equipment is made abroad. It is more profitable for our partners to use the Russian base to install their own developments.

- What changes have occurred over the past 10 years in terms of the distribution of the supply of Russian weapons, samples of domestic military equipment to various markets?

- If earlier we said that our main partners are India and China and they still remain so, then recently a very serious breakthrough has been made in Latin America. This is not only Venezuela, but also Ecuador, Uruguay, Brazil. Contacts with Argentina are actively developing, our helicopters, Igla MANPADS, have long been used in Mexico. We really made a very serious breakthrough in the Latin American market. And a significant role in this, I believe, was played by certain political motives that guide the leaders of Latin American states. For us, this market is interesting and promising. By the way, here we not only trade, but also provide military-technical assistance to such countries as, for example, our traditional partners - Nicaragua and Cuba.

We have revived our presence in the Arab world. And here the conversation is not only about traditional partners - Syria, Algeria, Libya. Now work is being done with Kuwait, Oman, Bahrain. It is no secret that negotiations continue with Saudi Arabia. That is, we entered the markets of countries that traditionally focused only on Western suppliers. Therefore, if not a breakthrough here, serious steps have been taken to restore Russia's military-political positions in the Arab world.

Our traditional partners are the states of Southeast Asia. Cooperation with Vietnam is developing very actively now - an entire program of interaction up to 2020 has been drawn up.

To a lesser extent, Russia is present today on the African continent, but even here there are certain plans for return. In Africa, we also have traditional partners who were oriented toward the Soviet Union: we supplied them with equipment, trained specialists, and, naturally, for them, the Russian military school is still closer than the western one. True, before the supply of weapons were mostly free of charge. Now our PTS system is commercialized. But even in this situation, we are looking for unconventional ways, understanding the limited solvent capacities of these countries.

- In the future, India and China will remain our main partners on military-technical cooperation, or are any changes expected?

- Changes in relations with India and China are that we are moving from the “seller-buyer” form to technological cooperation. That is, first of all, these countries are interested in the possibility of developing their own defense industry, and they are making progress. In particular, China is already a serious competitor of Russia on the African continent. So the development of our relations will continue, but it is somewhat modified in terms of content - the focus will be on technology transfer, on joint development. With India, for example, in addition to the creation of the BraMos family of missiles, we are actively involved in such projects as the fifth-generation fighter and medium transport aircraft. In these areas, joint development is underway, part of the units, nodes and systems will be created by Indian partners.

- How serious are the problems with the quality of Russian weapons? Do you often have to deal with complaints? Is there a tendency to improve products?

- I will not hide: there is a quality problem, but she was born for objective reasons. It is primarily about the failure of 90-ies, characterized by the outflow of qualified personnel, violation of cooperative ties. But it must be emphasized that since the beginning of 2000's, our industry has been reborn. And now we can directly say that we have returned the positions that were laid down by the Soviet defense industry. This also applies to personnel, and updating production assets. If you look at the statistics, now there is a clear tendency to a decrease in claims against us. At the same time, customers have become more demanding, because if they pay money, they expect to receive a product of good quality. Work is under way, and in the framework of state programs to improve the quality of the supplied products, and to increase the level of production control. The problem exists, they know about it, they are actively fighting to correct the situation. And the results are there.

- Has the formed structure of foreign deliveries of Russian military equipment with one main exporter represented by Rosoboronexport and a number of enterprises eligible for independent access to the external market, is optimal? Are there any changes expected?

- I have been working in the VTS system for 15 for years. During this period, there were various options for special export. It was the State Technical University, then a number of enterprises received the right to export their products independently, bypassing intermediaries. Three mediators in the person of Rosvooruzhenie, Russian Technologies and Promexport worked simultaneously.

The system to which we have come now, at this stage of competition, at this stage of optimizing the supply process and post-warranty service, when 22 enterprises are entitled to independently repair, upgrade and supply spare parts for the equipment they produce, is optimal. But its current configuration is not a dogma. If necessary, such a scheme can be changed to improve the progress of Russian weapons.

The PTS system should not be stiff; it needs to maintain flexibility. At the same time, if any changes in the scheme of special export are required, they will not be revolutionary. But while the PTS system, I repeat, is optimal. Volumes are growing, the geography of our supplies is expanding, so it is pointless to cut the hen that lays the golden eggs. Since December 2009, in three states, we have opened representative offices of the Federal Customs Service Archive under the Russian embassies in India, China and Vietnam. This year we plan to create our missions in two more countries - in Algeria and Venezuela. By this indicator, by the way, it can be concluded who is one of the main partners of Russia in the field of military-technical cooperation.

If necessary, we will open new offices, which will increase the efficiency and overall effectiveness of our work. Representative offices have the status of regional, that is, act in the interests of nearby states, with the exception of missions in India and China, where there is enough work and within the same country. The Ministry of Foreign Affairs welcomed this initiative with great enthusiasm. Indeed, in the most important countries for us now work people professionally versed in military-technical cooperation.

- Sometimes we hear that the system of Russian special export is too bureaucratic and, for example, a batch of three dozen machine guns requires months to agree on the issue of delivery. Are there any reserves for increasing the operational efficiency of the MTC system?

- There are reserves. Moreover, the president of the Russian Federation has been tasked with improving the registration system and the work of the bureaucratic apparatus. A number of proposals aimed at streamlining the process of issuing permits have been put forward by our service and have been approved by both the government and the head of state.

Now it is impossible to say that this process is so bureaucratic. If earlier we really had cases, when the administrative papers were prepared within two years, but now the issues are considered fairly quickly. Established regulatory deadlines for each ministry and department for consideration of certain documents. They are in most cases - if there are no problematic issues - are maintained.

But there is one more thing, which, unfortunately, has not been resolved to the end. I'm talking about the development of interaction at the level of the seller and co-executives. If the contract is entrusted to Rosoboronexport, he must establish contacts with the parent company that will produce the required products. So, the process of interaction between the head and the cooperation, which is divided into several levels, is not completely worked out. At this stage, we are really losing a lot of time now. And there is work to do.

- Could you make a forecast on the dynamics of revenue in the system of military-technical cooperation for the near future?

- This is not really my question. But I can say that for the current year we should again increase the amount of revenue. If according to the results of 2009, there were more than 8 billion dollars, then in 2010 we plan to earn more than 9 billions. The dynamics of the constant growth of income from arms exports is present. This once again testifies in favor of the fact that we not only exploit the Soviet backlog, but also bring new developments to the market. If they were offering one old thing, they probably would not have taken the positions they have reached.

Private bussiness

DZIRKALN Vyacheslav Karlovich

Born on August 6, 1954 in Riga. In 1976 he graduated from Riga Higher Military aviation Engineering College named after J. Alksnis. From 1976 to 2008 he served in the Armed Forces. From December 2004 to the present - Deputy Director of the Federal Service for Military-Technical Cooperation. He was awarded the medal "For Military Merit", the Order of Friendship.