KUALA LUMPUR. Aug 5 (Interfax-AVN) - The Tuesday Russian- Malaysian business forum in Kuala-Lumpur saw the ceremony of exchanging of bilateral agreements in a number of fields signed earlier by companies from the two countries.
For example, AIROD of Malaysia and Russia's arms trader Rosoboronexport announced a deal for a batch of MI-17-1V helicopters.
Malaysia's Negara Bank and Russia's Vneshtorgbank signed a loan agreement to finance palm oil deliveries to Russia for USD50m.
The Russian Irkut corporation and Sapura Group exchanged documents on joint efforts in developing and manufacturing avionics.
Irkut also exchanged documents with Malaysian counterparts on the formation of a center to promote the Russian BE-200 aircraft on the regional market.
The Russia-ASEAN Cooperation Fund signed an agreement on the formation of a Russia-Malaysia business council with the Asian Strategy and Leadership Institute (ASLI), which has founded similar councils with the United States, Britain, China and India.
The size of the helicopter deal has not been disclosed. However, earlier reports said that in 1999, Russia delivered four such helicopters to Malaysia. They proved effective and Malaysia studied the possibility of acquiring 10 more to replace the outdated S-61A4 helicopters of which Malaysia has 28.
Malaysia has also shown interested in acquiring about 40 MI- 8AMTSh military transport helicopters.
The Kazan Helicopter Plant manufactures the MI-17-1V, which is designed for the transfer of arms and military equipment, landing, search and transport operations and evacuating wounded individuals. Thanks to its weapons and guidance equipment, it can be used in combat against tanks and ground force fire support.
The modified MI-17-1V has a number of distinctive features compared to the standard MI-17 Hip model. Its left-hand side door has been expanded to 125 centimeters to speed up landing while the right-hand side door is of standard dimensions. The flaps of the cargo compartment have been replaced by a hydraulic ramp, permitting the transportation of large cargo and landing up to 25 servicemen in 15-25 seconds.
Its civilian modification is widely used for cargo and passenger transportation, fire-fighting, and search and rescue operations.
Russia and Malaysia launched their military and technical relations in the mid-1990s when Malaysians purchased 18 MIG- 29SE/29UB fighter and trainer aircraft. Later, a joint venture was set up to maintain the services of Russian fighter jets in Malaysia. Furthermore, a Malaysian company invited the Kolomna Machine-Building Design Bureau to organize the production and maintenance services of Igla MANPADs in Malaysia.
2001 saw the Russian-Malaysian USD30m contract for Metis-2 anti-tank systems.
Experts say the new prerequisites for mutually beneficial military and arms trade have appeared in the past few years.
They single out the impact of the USD900m contract initialed during Russian Defense Minister Sergei Ivanov's visit to Kuala Lumpur in May. It implies the delivery of 18 SU-30MK Flanker fighters over a period of five years. Russia is becoming the main supplier of warplanes to Malaysia and is significantly increasing its foothold on the Southeast Asian arms market.
First Deputy Director of Rosoboronexport Sergei Chemezov told Interfax that Russia would get the full USD900m in cash and denied reports that part of the contract would be paid with commodity deliveries, including palm oil.
The contract for the SU-30MKM will be signed in Kuala-Lumpur on Tuesday in the presence of the Russian president and Malaysian prime minister.
In April 2002, a USD48m contract for the transfer of Igla MANPADs to Malaysia was signed. Deliveries will last for three years. According to Malaysia, several hundred Iglas and Jigit supportable launchers and launch modules are in question.
Today experts are predicting an increase in Russian arms deliveries to Malaysia, given the economic growth in that country, which is now recovering from the financial crisis that hit in the late 1990s. Malaysia annually assigns about USD1bn for purchasing arms and military equipment. Experts estimate that in the near future it may increase military spending 25-30%.
Space exploration is another promising field for joint efforts. Malaysia has launched a satellite with a Russian rocket and there are possibilities of further partnership in this area, specifically involving mobile rocket systems. Thanks to its geographical location, Malaysia can be regarded as an ideal place for the construction of a spaceport and may develop into a regional center for the aerospace industry by 2015, experts say.
The prospects for military-technical cooperation with Malaysia also depend on the insistence of arms traders and a more flexible approach to the payment forms, guarantees of maintenance services etc. Even today Russia is using such cooperation patterns as aircraft leasing. For instance, Malaysia operates Russian-made AN-38-100 aircraft under such contracts.
Russia is ready not only to deliver arms and military hardware but also to cooperate in developing corresponding research and production facilities relying on advanced technologies in Malaysia, experts say.