The 7^th International Maritime and Aerospace Exhibition held early in October on the Malaysian island of Langkawi (LIMA-2003) was a triumph for Russia’s defense producers. With a delegation numbering more than a thousand specialists and representing three dozen enterprises, Russia made contracts to sell nearly $ 1 billion in military equipment to a number of Asian countries. This is a record for Russia compared to its participation in similar shows.

Despite the fact that the Malaysian Exhibition of Arms is considered to be the largest in the Asia-Pacific region, the number of its participants and visitors has steadily declined over the last few years.
Experts attribute the decreasing interest in LIMA to political causes. Most US corporations boycotted the last show at Langkawi due to September 11. They referred to the ambiguous reaction of Malaysia’s Moslem community as the reason for the boycott. Meanwhile, in 2001 Malaysia’s leadership decided who should be awarded the contract for 18 fighters to the tune of $1.5 billion worth. At the time, the contract went to the Sukhoi and Irkut Corporations.
This year, the same thing happened. Two days before the exhibition, Malaysian Prime Minister Mahathir Mohamad made an utterly harsh statement at the UN General Assembly criticizing the US and its allies for the occupation of Afghanistan, the war in Iraq, and the support given to Israel in the conflict with Palestine. This couldn’t have improved Western corporations’ attitude toward LIMA. The overwhelming majority of Europeans had the smallest possible exhibits at Langkawi. The delegations of EADS, Alenia, Dassault, Finmeccanica, FiatAvio, and other major European players were represented by vice-presidents for sales, at best. Israeli IAI and Elbit, as well as US Lockheed Martin and Northrop Grumman, declined participation in the exhibition at all.
Boeing proved an exception among the Americans. The corporation brought its F-16 and F/A-18 Super Hornet to Langkawi for demo flights. Boeing’s leadership reckoned to sign a contract with Malaysia’s Defense Ministry at the Exhibition for twelve F/A-18 fighters but instead of a contract they had to be content with a mere promise made by Mahathir Mohamad to purchase the US aircraft sometime in the future. “Malaysia has already made a number of big contracts amounting to several billion dollars over the last few years and will have to suspend the purchase of arms,” believes Mr. Makienko, a deputy director of the Center for Analysis of Strategies and Technologies (CAST). When opening LIMA-2003, Mahathir Mohamad stated, “Russia is a key participant in the Exhibition, and we hope that contacts between Kuala Lumpur and Moscow in military-technical cooperation will expand.”

The Malaysians paid close attention to Russian weaponry at the Exhibition. Mahathir Mohamad himself, along with his future successor Abdullah Ahmad Badawi and Defense Minister Najib Razak, visited the Russian corporations’ expositions every day and thoroughly questioned the military experts present about the technical features of the fighter jets and helicopters.
Against the Western defense companies’ modest stands, the Russian part of the exposition occupied nearly half the entire hall and looked quite impressive. About 500 different Russian military and civil products were presented at LIMA-2003 under the aegis of Rosoboronexport. Moreover, the demo flights of Su-30MKI planes piloted by Vyacheslav Averianov, a Hero of Russia, and a Malaysian Royal Air Force pilot produced an impression even on frequent visitors to world air shows.
Such a powerful representation of the Russian defense industry at Langkawi is easy to explain. The August contract for SU-30MKM, signed during Vladimir Putin’s visit to Kuala Lumpur, brought Malaysia to the fourth place among the largest importers of Russia weapons. Then, at the meeting with Putin, Mahathir Mohamad stated that “Russia may regard Malaysia as a strategic staging ground for economic conquest of the region.” According to Alexei Fyodorov, the President of the Irkut Corporation, Malaysia is of interest to the Russian defense industry not only as an arms purchaser but also as a step toward further expansion into the countries of Southeast Asia.

Currently, Sukhoi and Irkut are holding talks with Malaysia’s Defense Ministry on setting up a post-sale center to service the squadron of Su-30MKM. As Mikhail Pogosyan told Expert, the center will most likely be established as a joint venture. The Russian side expressed the desire to the leadership of Malaysia’s Defense Ministry to enlarge the scope of competence of the Russians in the center.
The subject of service was widely discussed in the lobby of the exhibition as well. Just before the show began, Putin laid reprimanded the cabinet, saying that the government had lost control over repairs of weapons supplied by Russians. Assigning Vice-President Boris Alyoshin to rectify the situation, the President stressed “there should be no glitches in this area.” The Defense Ministry’s respond to Putin’s statement came immediately.
The Malaysian military may also hope for progress in repairing its MiGs. On the second day of the exhibition, the Ural Optical Mechanical Plant and Malaysian Mattra signed a contract to supply optical-location systems for MiG-29s. The amount of the deal has not been disclosed, but according to information obtained by Expert, it exceeded $5 million. According to Veniamin Elinson, a deputy director at the Ural plant, the contract with Mattra is just the beginning of his enterprise’s expansion into the countries of Southeast Asia. Currently, the company’s leaders are studying a possibility of setting up a joint venture in Kuala Lumpur with another Malaysian company, Top Optik, to produce high-tech surveying instruments destined for the Malaysian Defense Ministry.

But the real success came to the Russian defense producers on the third day of the exhibition. Rosoboronexport General Director Andrei Belyaninov and Malaysian company Airod President Ahmad Johai signed a contract for 10 military transport helicopters totaling $70 million. Interestingly, so far Malaysia’s Defense Ministry has only used Western-built helicopters, but now it has decided to change suppliers. As Leonid Belykh told Expert, should Russia fulfill contract completely, the Malaysian military intends to order another 29 helicopters to replace the whole fleet of machines made by Sikorsky.
A pleasant piece of news came from neighboring Indonesia where concurrently a military parade dedicated to the country’s armed forces was taking place. Andrei Belyaninov and Mikhail Dmitriev, who attended the parade as honorary guests, reached an agreement with Indonesia’s president about the option for twelve Su fighters.
Finally, right before the curtain of the exhibition fell, two other big deals were announced. According to information obtained by Expert, Vietnam expressed a willingness to purchase from 12 to 18 Su fighters for $270-300 million. True, only a preliminary agreement has been made with the government to date. However, Rosoboronexport had already signed a firm contract with India to supply three A-50 airplanes with long-range radar detection to the tune of about $75 million.

Experts link the high demand for the Russian arms in Malaysia, Indonesia, Vietnam, and India first of all with these companies’ replacement of their old aircraft and helicopters. For example, the Vietnamese and Indian Air Forces’ fighting power is based on Soviet 2G and 3G fighters and bombers – MiG-21, MiG-23 and Su-22 that will be taken out of commission in the next five years. By very rough estimates, Asian countries’ arsenal totals about 300 units of battle air equipment subject to replacement with more recent models. This means that the demand for new military equipment in Asia will grow steadily. In a speech at the exhibition, Mahathir Mohamad stated that the countries of Southeast Asia are ready to purchase nearly $70 billion in weapons by 2006. According to the Malaysian Prime Minister, these considerable expenditures are required to effectively combat marine piracy and international terrorism.
But there is another reason, which neither Russian defense companies nor Asian politicians want to mention: China’s increasing military strength. It is no secret that within the ASEAN economic bloc a group of countries headed by Vietnam and Malaysia considers China as their potential military adversary. Therefore, whatever Malaysia’s Premier might say about piracy and terrorism, it’s clear that a squadron of Su-30MKM won’t do well against this evil. It will be excellent, however, in containing China.

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