Rostec actively expanding international operations

Dmitry Shugaev, Deputy Director General for international economic co-operation, Rostec. Source: Press Photo

Dmitry Shugaev, Deputy Director General for international economic co-operation, Rostec. Source: Press Photo

Dmitry Shugaev, Deputy Director General for international economic co-operation, Rostec talks to RIR about the company’s successes and strategic plans, while assessing the dynamics of cooperation with foreign partners.

Recently, the International Aviation and Space Salon MAKS- 2013 ended in Zhukovsky near Moscow. What novelties did the Rostec unveil at this year?

At MAKS – 2013, Rostec’s holdings, which produce more than 80 percent of the component base for the Russian aircraft industry, presented almost their entire range of equipment that is used in modern aviation and space. This includes avionics; newest spacecraft design items, various optical devices, aeronautical and space communications systems, as well as weapons for the Air Force and Air Defence and more. For example, the Radio-electronic technology group (KRET) introduced new instruments for the fifth generation fighter PAK FA (T- 50) and the world's most powerful radar system management "IRBIS-E" for the Su-35 fighter.

In addition, as part of its air show business program Rostec  has concluded a number of cooperation agreements with Russian and international aircraft manufacturers. In particular, an agreement was signed with the Denel (South Africa) group of companies, Turbomeca, a French company, and Airbus.

The State Corporation is also considering the possibility of creating a Russian joint venture in the assembly of regional jets, regarding which, there were relevant agreements signed as part of the air show.

At the same Rostec along with Diamond Aircraft Industries has already launched a project to develop a new type of light aircraft with a capacity of 9 to 19 passengers.

What are the priority markets for the corporation in general and for the novelties exhibited at the MAKS- 2013 in particular? What markets are seen as the most promising ones, which ones are developing most rapidly?

Almost one third of the enterprises’ production is exported. The corporation has 50 overseas offices, which help to promote our products in more than 70 countries. Largely because of this, the Russian Helicopters holding company, for example, already ranks first in the world for its sales of combat attack helicopters, and VSMPO AVISMA already supplies over 30 percent of the world’s titanium requirements, including 40 percent of Boeing’s requirements, 60 percent of Airbus and 100 percent of Embraer. Overall, we are now focusing on increasing the share of the corporation enterprises’ commercial production on the domestic and foreign markets.

In addition to the MAKS, what other exhibitions and which channels are used to make cooperation with your partners possible?

 Contracts for the supply of the next generation Russian equipment are often made on the grounds of the world’s largest exhibitions, such as the French Le Bourget, Farnborough, UK, Peruvian SITDEF, Dubai Airshow, the Russian HeliRussia and others. Rostec represents a single organizer of more than 20 exhibitions abroad in the line of Russian military-technical cooperation. On these grounds, the State Corporation is negotiating with international partners, after which joint ventures are often created. This, in turn, provides a transfer of innovative technologies to the Russian industry and expands Russia’s presence in the export markets.

The State Corporation already has a large experience in attracting international strategic partners: Alliance Renault-Nissan – to AvtoVAZ, Deimler – to KAMAZ, the Italian Pirelli – to Voronezh and the Kirov tyre plants. Rostec is also interested in developing relations with the State Corporation’s current partner in the Helivert joint venture – the Anglo-Italian manufacturer AgustaWestland. In particular, there is a possibility of the company entering into Russian Helicopters holding capital through purchase or exchange of shares.

What can you tell us about the corporation’s cooperation with China, India and Latin America?

We continue to develop partnerships with our colleagues in China, also by means of the Business Council of the BRICS countries. Atomic energy, civil rocket science, the export of helicopters and their after-sales service now appear among the highly prospective areas of cooperation. In addition, in February of this year, Rostec has signed an agreement of intent with the Chinese company Polygroup on a joint venture for the production of machine tools for the metalworking industry and energy-saving lighting technology.

As for India, it is one of Russia's key markets of military and dual-use items. The state intermediary Rosoboronexport’s portfolio of orders is worth more than $6 billion. We are talking about contracts for the supply of a wide range of weapons for India’s Air Force, the Navy and the Army. In addition, Rostec continues to expand its cooperation with India through creation of joint ventures. Several joint ventures have already been created only in terms of production and repair of arms and military equipment

For us Latin American countries are a fast growing and highly promising market for aircraft exports. It is worth noting that Rostec has agencies abroad in Argentina, Brazil, Chile, Colombia, Cuba, Mexico and Peru. With the help of our representatives, Russian Helicopters has already sent several Mi type machines and medium-sized multi-purpose Ka-62 helicopters to Brazil. At the same time, the contract for the supply of Ka-62 is the first international contract of this kind for Brazil.

Rostec opened a service centre for Russian civil helicopters of types Mi-8/17 and Ka-32 in South Africa. In addition, there are plans to build a regional centre for after-sales services and repairs for all the helicopter models used in the sub-Sahara region on the grounds of the Denel Aviation company. 

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