A Step Higher

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General Director of Russian Helicopters, JSC Alexander Mikheyev speaks to BRICS Business Magazine about completed contracts, joint projects, and the special relationship that has developed between India and Russia.

In Soviet times, India and the USSR were linked through military, economic, and diplomatic relations. Russia, as the USSR’s legal successor state, inherited the warm relations. How have the relations between our countries developed in the sphere of military-technical cooperation, specifically regarding helicopter-building, and how do you personally assess Russian-Indian relations over the last 15 years?

India has always been our country’s main strategic partner. It kept this status after the Soviet collapse. The most intense and rewarding Russian-Indian cooperation has been and remains in the sphere of military-technical cooperation. It began in the mid-1950s and continues to date, with increasing volume. Today, 70% of Indian armed forces’ equipment is supplied by Russia and the Soviet Union; some weapons are assembled under licenses, for example, T-90S tanks. These are just specific examples that immediately come to mind. Factually, Russian-Indian cooperation is at a much larger scale. The proportion of licensed technology in the Indian Air Force is about 80%.

In recent years, the format of our cooperation with India has undergone significant changes, reaching the level of a privileged strategic partnership. Our two countries have implemented a number of major projects, not only in the military-technical sphere, but also in conducting joint R&D, the establishment of joint ventures, organization of licensed production, etc. All this, of course, puts India a step above a number of our other partners in military-technical cooperation.

How would you describe the specificities of business in this country?

Indians are very similar to us, Russians. Business culture in India is also very similar to ours. They are open, friendly, but are careful enough as negotiators, thus often stretching out the negotiation process for months, since Indians will never say ‘no’ directly, because, in their view, it might offend their partner.

In addition, ‘networking’ is very important in India. Knowing the right and useful people for doing business may make up to 90% of success. Although, in recent years, the situation in India is changing. Indians have successfully integrated into global business, so they are becoming more focused on Western values and Western business ethics.

How is the cooperation between Russia and India developing in the field of helicopter delivery? What helicopters have the highest demand in India and why?

India has long been using Russian helicopters; I would call this country a ‘helicopter pioneer’. In 1960, Indians needed a large number of multi-purpose helicopters for use in the Himalayas. These were 110 Soviet Mi-4s, which worked well in the Indian highlands, thus paving the way for other Soviet helicopters in Indian skies.

After some time, the Indian Air Force purchased more than a hundred Mi-8 helicopters. Then their helicopter fleet was replenished with heavy-transport Mi-26 helicopters, Mi-25 and Mi-35 attack helicopters, and naval multipurpose Ka-25, Ka-28, and Ka-31 helicopters. Besides the abovementioned helicopters, Mi-17s have also been used in India. It is no exaggeration to say that the Indian fleet today operates with virtually the full range of Russian-made helicopters (over 400 units) and there are plans for the fleet’s expansion. At the beginning of 2016, Russian Helicopters has fulfilled the contract of supplying 151 Mi-17V-5 helicopters. In September 2015, the Indian government approved the purchase of another 48 vehicles of this type for the sum of $1.1 billion, and we expect the signing of the Rosoboronexport, JSC contract by the end of this year. We are also bringing new helicopter models to the market, for example, the medium multi-purpose Mi-38, which is considered to be one of the most advanced machines in the domestic helicopter industry. This helicopter is fully assembled from Russian components and can fly at extremely high speeds and altitudes. Its scope of operation is also wide: from the transportation of goods and passengers to implementation of search and rescue and sanitary works. Mi-38 was certified at the end of 2015 and is ready to enter the market, including at the international level.

I can say that India has a large demand for Russian light- and medium-class helicopters, primarily for the armed forces. India is now very actively renewing its helicopter fleet. In addition, the country needs machines that can be used in harsh mountain terrain, through strong crosswinds, and with a lack of equipped pads. Our helicopters meet all of these requirements.

India’s new leadership announced a policy of actively attracting foreign investments into the country’s economy and proclaimed a ‘Make in India’ policy. What can Russian Helicopters offer India in the framework of this policy? What joint projects might be of interest to India?

Over the past 10 years, Russian-Indian military-technical cooperation has transformed from a purely commercial ‘supplier-consumer’ model into a cooperative-production model, where the parties organize joint military-industrial enterprises and equally bear all risks.

India has become one of the first customers in the relations with which this new military-technical cooperation model is applied. This is very important, because in this way we not only contribute to strengthening Russian Helicopters’ position in the Indian market, but also help to develop the Indian national defense industry. Russia offers India the newest technologies, which no other country is willing to share.

Currently, an agreement on cooperation in the field of helicopter-building is signed between Russia and India. There are joint works under way on the outlook of the light multi-purpose Ka-226T helicopter, which will be produced on Russian and Indian territory. This is the first Russian-Indian high-tech project, implemented by the Indian government in the framework of the ‘Make in India’ initiative. In accordance with this initiative, the possibility of production of Russian components in India has also been assessed. Russian Helicopters is considering the possibility of producing components that require a high level of competence in metalwork with one of the world leaders in this field – the Indian company Bharat Forge, which is part of the Kalyani Group. In addition, our international partners are considered for localization of production cooperatives project in the framework of ‘Make in India’. For example, Turbomeca company, given the importance of the localization provision and volume of the order, does not exclude the localization of Arrius 2G1 engines for the Ka-226T in India.

Cooperation between Russia and India can potentially be expanded to other areas. So, currently, customers are showing great interest in the promising medium-sized multi-purpose Ka-62 helicopter. The main use of Ka-62 included passenger transportation, rescue operations, as well works in the oil and gas fields. Thanks to the spacious and comfortable cabin, the helicopter is ideal for corporate travel. Cooperation on this project, given the possibility technology transfer, may certainly be of interest to our partners.

Have you signed new contracts to provide after-sale services for helicopters?

We are looking at signing a long-term contract with the Indian Ministry of Defence to provide after-sale services for Mi-8/17 type helicopters. We are talking about after-sale hardware services and maintenance in an entirely new format. The holding offers to provide comprehensive after-sale services on a long-term basis with pre-agreed delivery terms and conditions and pricing parameters, in a departure from the previous practice where maintenance services and spare parts were provided under one-off requests and tenders. We are looking at fostering such cooperation with India’s Air Force, Navy, and border guards. This new cooperation format will enable us to reduce after-sale services timelines, simplify budget planning for our Indian customers, and plan spare parts production for Indian operators. This will propel the after-sale services we offer for Russian-made helicopter equipment to a brand new level. Helicopters operating in India will undergo repairs both at Russian Helicopters’ facilities and the service centers that are being set up in India.

What technologies is Russian Helicopters ready to share with India?

The Ka-226T helicopter program is a new stage of our cooperation with India. Moscow and New Delhi signed an intergovernmental agreement in December 2015 which envisages the production of at least 200 units of Ka-226T in India. Local production is expected to be organized at the facilities of the Indian aircraft maker Hindustan Aeronautics Limited (HAL), which will be constructed for this project in the Indian state of Karnataka, and engagement of other companies is possible.

We offer the Indian side full partnership and cooperation in the aviation technology sphere. We are ready to transfer up to 70% of our helicopter production technology, including the establishment of helicopter assemblies and aggregates, to India. If successful, this will radically change the model of our cooperation in the helicopter sphere.

How is the implementation of the project coming along?

The draft project of creating a joint venture for the production of 200 units of light Ka-226T in India is now being decided upon. The partners (from the Russian side, Russian Helicopters and Rosoboronexport, with HAL Corporation from the Indian side) are holding negotiations on the areas of responsibility, shaping machine visuals, as well as detailing the terms of transaction. In addition to helicopter assembly, creation of programming and application software, which includes a center of technical support and helicopter maintenance, as well as an aviation training center for pilots and technical staff. Training of Indian specialists is planned in two stages. The first stage is the training in Russia. As the localization of production in India will take place, the Russian side will create an aviation training center, and provide it with the necessary modern methodological and technical means of education. Training of teachers and trainers will be carried out. Contract signing is expected to be finalized soon. For us, this is, without a doubt, a breakthrough project; as for the first in the field of helicopter-building, we offer our Indian partners not only localization, but also, as I said, the transfer of technologies.

How realistic is the interest of third countries in the implementation of joint Russian-Indian projects in the field of helicopter building (such as in the BrahMos case)?

We are now entering a new level of cooperation that focuses on deep industrial cooperation and joint research and development, and even bringing high-tech products to third-country markets. Indeed, the most striking example of such cooperation is the work on the supersonic ship missile BrahMos, which Brazil is already interested in. We have the highest prospects to create co-production, including in the helicopter field, with the BRICS countries. This would significantly reduce technology manufacturing costs, will help to develop, deploy, and bring new breakthrough technologies to market, and strengthen our positions in third-country markets. Therefore, we hope that the Indian assembled Ka-226T will be successful not only on the ‘home’ market, but also beyond it. There is great demand for the multipurpose Ka-226 helicopter and its modifications. It is an agile, manageable, and compact machine.

The transition to such a cooperative model should, of course, be considered as a positive development that improves Russia’s position on the Indian market, and even more so, as opening the prospects of forming a common Indo-Russian military products market. There are already a number of prerequisites for this, such as the implementation of BrahMos and FGFA projects, which allow Russia and India to jointly develop new markets, and will be the first step towards the creation of a common military products market resembling the European one, when, say, a German helicopter is purchased in the UK. However, this is an option from a fairly distant future, and, of course, needs to be worked on.

Almost all of the BRICS countries are suppliers of military products outside the regional bloc, and theoretically, they are each other’s competitors. How promising is it for us to establish joint ventures in India?

Today, military-technical cooperation mainly focuses on the transfer of technology and joint developments. Without this model, Russian military-technical cooperation has no future. According to Russian President Vladimir Putin, there is a need to deepen the “civilized, fair, and mutually beneficial partnership” in military-technical cooperation. In the future, this will certainly yield benefits in the form of ensuring national interests in arms trade, since MTC is not only trade in goods in the conventional sense, but is also a very sensitive sphere of activity.

The Russian Helicopters – Technology construction office, which is also a part of Russian Helicopters, is actively engaged in the development of unmanned aerial vehicles, including helicopters. Is there any interest from India in jointly creating a civilian helicopter UAV, for example, for agricultural or for water monitoring purposes?

As we know, India has recently been making a very serious bet on drones. This applies to both the military and civilian spheres. For example, Indian engineers are developing a small drone that would be able to carry small loads, and fly for a distance of at least 100 kilometers.

The construction office of Russian Helicopters – Technology, which develops helicopter and convertiplane type drones, may provide a RHV-35 conversion plan, if there is interest from the Indian side. This machine is indispensable in the countryside, where there are no landing strips, as it can take off and land from unprepared sites, such as unpaved roads or roofs of buildings. The device is able to maintain control of smoke pollution in forests and dense urban areas, carry out aerial photography, conduct monitoring of oil and gas facilities, and deliver medical supplies to remote areas. It can spend a long time in the air – about five hours – and develops a speed of 140 kilometers per hour. We should not rule out that work in this direction will start with our Indian partners.

Russian Helicopter recently passed an ‘Arctic’ helicopter to the Russian Defense Ministry, designed to perform a wide range of tasks in Northern latitudes. Does the holding group have any plans to create a purely ‘tropical’ helicopter?

All of our equipment can function at extremely high temperatures in highlands and deserts, in aggressively wet and maritime climate. Each machine goes through thorough and comprehensive testing at the factories, for example in a rainwater chamber. It is a necessary test for helicopters that will later fly in South and Southeast Asian countries. Our helicopters have proven themselves worthy in these conditions, and there is no need to make a separate ‘tropical’ helicopter.

However, I will note that around the world today, there is work underway to create a high-speed rotary-wing aircraft of various designs. Our design bureau developed a flying laboratory in which systematic experimental and research work is being conducted. We check the solutions in flight experiments that will, in the future, be implemented in new high-speed helicopters. That is, a technological advance is created that will later allow for the gradual establishment of a high-speed helicopter. The results obtained during test flights, have on a number of parameters exceeded our initial expectations and estimates. Continued work in this area has great scientific and practical potential and opens up new prospects for Russian helicopter-building.

How would you assess the cooperation with Indian partners in general?

For the Russian Helicopters Group, as for the whole country, India has been and remains an important strategic partner. We can only evaluate bilateral cooperation positively, because even in state of crisis of the global economy, our relations continue to develop dynamically and steadily. We are implementing a number of joint projects, that were mentioned above, but it is important to note that in many aspects, cooperation with Indian colleagues is conducted not only at the political level, but also at the level of a good relationship of trust that was developed over many years. Delegations from India regularly visit our factories, get acquainted with the production, and we exchange experiences. Active work is being done by the Indian Ambassador to Russia, HE Pankaj Saran, who has visited the part of the Rostvertol plant, which is part of Russian Helicopters this summer and praised the quality of the products. There are increasing number of delegations coming to Russia headed by state governors of India, who visit exhibitions and events, hold negotiating. I am convinced that further strengthening and expansion of cooperation with India is correspondent to state interests and will allow to bring bilateral cooperation between the two countries to a new level.

Official partners

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