Malaysia Concludes Biggest DSA on Record
BY WENDELL MINNICK KUALA LUMPUR — The Malaysian government signed 14 contracts and several agreements with foreign and local defense companies during an April 21 ceremony, part of the 11th Defence Services Asia Exhibition and Conference (DSA) here.
Held at the Putra World Trade Centre, the signing ceremony for the agreements — worth $360 mil lion — was overseen by Deputy Prime Minister Najib Razak, who is also Malaysia’s defense minister.
Most of the agreements were with local defense companies for procurement of more than 100 infantry vehicles. Among the agreements, however, was a letter of acceptance worth more than $50 million for three AgustaWestland AW139 helicopters for the Maritime Enforcement Agency; a contract with Lockheed Martin for a $14.6 million upgrade for the C-130; and two three year contracts worth more than $3.5 million with Britain’s Kelvin Hughes for continued servicing of the navigation radar and combat system on four Laksamana-class corvettes.
The April 21-24 DSA, the largest triservice show in Asia, has grown from 389 exhibitors in 1988 to this year’s 712 from 49 countries. Organized by the DSA Exhibition and Conference Sdn. Bhd. in partnership with the Malaysian Ministry of Defence, the show hosted more than 200 foreign government officials from 60 countries and more than 25,000 visitors.
The exhibition included a four-day Battlefield Medical Live Demonstration, with presentations by Britain, Germany, Norway and the United States; the Training and Simulation Seminar on April 23, organized by the European Training and Simulation Association and the International Training and Simulation Association; and the show’s April 23-34 conference, “Partnership in the Defence Industry: Challenges and Lessons Learned.” DSA 2008 featured 23 country pavilions, including China, India, Iran, Russia, Turkey, the United Kingdom and the United States. However, Iran was ejected from the show after U.S. and several European officials complained to DSA organizers that Iran’s presence violated the United Nations arms export-import ban on Tehran.
With the exception of Raytheon and L-3, the U.S. presence consisted mostly of smaller companies. One U.S. defense contractor said the show was a disappointment, with no major procurement tenders of interest.
Offsets and Home-Cooked Arms
Offsets and promoting indigenous industrial development is taking a more important role in Malaysia.
Numerous local companies introduced new products, including GIG Technology’s Flying Hovercraft for special operations reconnaissance. Priced at $350,000 for a basic craft, it seats six, can be outfitted with a variety of weapons and has a 400 kilometer range at a speed of 38 knots. It has a hover mode and can fly two meters above the water. In production since 2006, it looks very similar to the U.S. Navy’s Universal Hovercraft UH-19XRW Hoverwing. “The Malaysian Army has ordered 10 for reconnaissance and interception missions,” a GIG official said. “So far, we have delivered four. The Philippines procured one platform and it is being used in Mindanao.”
Malaysian company DEFTECH, which builds military vehicles, signed four contracts April 21 to supply the country’s military with 48 Adnan ACV 300 infantry fighting vehicles, eight ACV-S 120mm mortar carriers and 87 3-ton, four-wheel drive Hicom Handalan II GS Cargo vehicles, and to refurbish 21 Scorpion tanks and 13 Stormer vehicles. DEFTECH is preparing to begin production of the AV4 four-wheel drive Light Armored Wheeled Vehicle, which it has been developing since 2003.
“This is our own development in cooperation with South African partners,” a DEFTECH source said. “All the installation is done here in Malaysia, with design and collaboration with Industrial and Automotive Design SA company, but we build here. ... We took the vehicle to Brunei and they are considering it. We plan on taking it to Timor Leste later this year to show them.” Both the Malaysian Army and police plan to buy it, he said.
“The police want a different variant for border patrols and riot control.” “Malaysia takes a long-term view of her defense needs and force planning, and is building a defense capability that gives us the best value for the resources that we have invested,” Najib said. “In this context, our approach to defense procurement is clear, and we will no longer just purchase technology off the shelf. We will seek to have a greater industrial role in what we purchase. We want our defense industry partners to offer value-added investments, not just industrial offsets, and we want to explore as well shifting resources from military and commercial programs to meet our needs.” Tan Sri Asmat Kamaludin, chairman of the DSA Exhibition and Conference Sdn Bhd, cited the importance of facilitating more offsets and indigenous industrial development.
“With many countries now requiring offset programs and transfer of technology, domestic defense industries in the region can look forward to spill-offs from increased defense,” he said in a news release. “Countries will look at maximizing suppliers through transfer of technology and offset programs and also to reduce costs where possible through locally produced items and services.”
Russia’s Malaysian Space Cadet
One recent offset resulted in a unique deal with Russia for new Sukhoi fighters in exchange for sending Malaysia’s first astronaut into space.
Russia’s large pavilion had booths representing 25 companies. Russian sales to Malaysia have been small but successful. The Royal Malaysian Air Force flies MiG-29 and new Su-30MKM fighters, along with Mi-17 helicopters. The Malaysian astronaut joined a Russian space mission as part of a $900 million deal in 2003, in which Malaysia procured 18 Su-30MKMs. Deliveries should be completed by the end of the year.
Malaysia’s interest in Russian equipment was the subject of an April 22 news conference here by Rosoboronexport. Referring to the Sukhoi deal, Anatoly Isaikin, director-general of Moscow’s state-run defense export-import arm, spoke in positive terms about potential future sales.
“We hope our military relationship with Malaysia will improve,” he said. “We can provide total solutions such as training, support and licensed production of military equipment such as the MiG-21 and Su-27. If foreign customers demand a total solution, we can provide it.” Russia is promoting the BukM2E midrange air defense system for Malaysian’s air defense needs, said Mikhail Petukhov, deputy director of the Federal Service for Military-Technical Cooperation.
However, a Malaysian Ministry of Defence source said his country’s mix of Western, Russian and other foreign weapon systems is causing integration headaches.
China Challenges Russian Influence
Russia might have competition in the Asian market from China, which has created an industry by copying and improving upon a variety of Russian-designed arms. There have been unconfirmed reports that China is negotiating an agreement with Malaysia for license manufacturing of FN6 MANPADS, and Malaysia has expressed interest in the Chinese made KS-1A medium-range surface-to-air missile system.
Chinese exhibitors here displayed a variety of arms for export. China National Precision Machinery Import and Export Corp. (CPMIEC), Beijing, displayed its new GPS/INS guided FT-1 Precision Guided Bomb, which can deliver a 500-pound bomb within a circle of equal probability of 30 meters. CPMIEC also displayed its portable air defense missile operation and command system, the THS311A SmartHunter Plus.
Of special interest among the export products displayed by China North Industries Corp., Beijing, was the new self-propelled LD2000 Ground-based Close-In Weapon System, a low-altitude air defense system armed with a seven-barrel, 30mm 730B gun, firing at a rate of 4,200 rounds per minute.