The Sino-Russian Arms Dilemma

For over a decade, Russian military exports to China have constituted the most important dimension of the two countries’ security relationship. Since the two governments signed an agreement on military-technical cooperation in December 1992, China has purchased more weapons platforms and hardware-related items from Russia than from all other countries combined. During the 1990s, the value of these deliveries ranged up to US$1 billion annually. In recent years, this figure has approached $2 billion per year. Through these dealings, the various branches of the People’s Liberation Army (PLA) have acquired Su-27 and Su-30 advanced fighter aircraft, Mi-17 transport helicopters, Il-72 transport aircraft, A-50 warning and control aircraft, SA-10 and SA-15 air defense missiles, T-72 main battle tanks, Kilo-class diesel submarines, and two Sovremenny-class destroyers [1]. Furthermore, in early November, Beijing and Moscow appeared to be finalizing a deal in which China would purchase the Su-33, an advanced carrier-based variant of the Su-27 (Sankei Shimbun, November 6).

Despite these impressive figures, the Moscow-Beijing arms axis is approaching a crossroad. The ongoing improvement in the quality of China’s own defense industry will eventually lead to a declining demand for the advanced weapons systems that Russia currently exports. Russian officials are therefore confronted with a choice: to accept the probability of declining Chinese orders and to seek alternative markets elsewhere or to offer to sell the PLA even more advanced systems that Russian export policies have hitherto prohibited.

Russian and Chinese Motives

Moscow’s decision to sell advanced conventional weapons systems to China results primarily from economic considerations. Despite the recent rise in national defense spending, the Russian government resists allocating substantial financial resources to restructuring the Russian defense industry. Citing the need to avoid repeating the Soviet mistake of competing in a ruinously expensive arms race, President Vladimir Putin and other Russian leaders have reaffirmed their commitment to hold annual military expenditures below 3% of Russia’s GDP. Instead, government officials have encouraged Russian defense enterprises to sell their products abroad to earn additional revenue for reinvestment and to keep skilled workers from moving into the civilian sector. Unlike energy exports—the other commercial sector where Russia can compete effectively with foreign sellers—arms exports generate high-tech manufacturing employment as well as revenue. Government officials also appreciate the fact that many Russian companies require increased investment to develop the type of advanced conventional weapons systems that have proven so effective for Western militaries in recent wars. International markets for Russian weapons systems, upgrades, maintenance and spare parts help sustain the production lines and workers that provide essential support for the Russian military. For example, foreign funding largely paid for the development of the Su-30, which has since been incorporated into the Russian Air Force.

Several considerations explain China’s interest in acquiring Russian arms. Economic factors come into play insofar as, by purchasing Russian weapons, China avoids having to research, develop and manufacture its own systems. Although China’s indigenous arms industry has become more capable along with the rest of the economy, Chinese defense enterprises still lag behind their leading international counterparts in several key areas, such as advanced aviation and naval weapons. Chinese firms have been trying to design their own light fighter plane, the J-10, but have had to use Russian-provided engines, radar systems and other technologies [2]. For its more sophisticated heavy fighters, the PLA Air Force still relies on Russian-designed planes, the Su-27 and the Su-30.

Moscow’s Dilemma

Although both the Russian government and its defense enterprises would like to perpetuate the current commercial arrangement, the increasing sophistication of China’s defense industry is enabling Chinese manufacturers to produce more advanced weapons systems under license instead of purchasing finished systems directly from Russian manufacturers. In addition, China has already begun buying fewer complete Russian weapons platforms, such as turnkey warplanes and warships. Beijing has instead been importing more military technologies, sub-systems and other essential components that Chinese manufactures insert directly into Chinese-designed weapons systems.

The ongoing improvement in the quality of China’s national defense production confronts Russian officials with a difficult choice. Until now, the Russian government has refused to sell its most advanced weapons systems—such as long-range strategic bombers or ballistic missiles—to China for fear that such weapons could disrupt the balance of power in East Asia. This policy has meant that Moscow’s arms sales to Beijing have not been sufficient by themselves to enable China to compete with the more technologically advanced militaries of Taiwan or Japan. Chinese firms, however, should soon be able to substitute their own technologies for many of the expensive defense items that the PLA has acquired from Russian suppliers in the past.

In order to retain Russia’s share of China’s defense market, Moscow could decide to sell even more advanced weapons systems to Beijing. In January 2005, the head of the Russian Air Force said that Russia had deliberately showcased their Tu-95MS and the Tu-22M3 at the bilateral August “Peace Mission 2005” exercises to entice Chinese buyers. Although these strategic bombers are older platforms, they can launch long-range cruise missiles against air and ground targets, including U.S. aircraft carriers [3]. Another possible export item might be Russia’s fourth-generation diesel-electric Lada-class submarines, the acquisition of which would also increase China’s military capability against the United States and its Pacific allies. According to the Stockholm International Peace Research Institute (SIPRI), the Russian government has already offered to sell China Su-33 and Su-35 advanced combat aircraft, which are still under development [4]. Fears that the United States is seeking nuclear superiority over Russia and China—as claimed in a widely read recent Foreign Affairs article—could also induce Russia and China to collaborate on nuclear and ballistic missile technology [5].

Managing the Consequences

A Russian decision to sell its most advanced weapons to China could trigger a sharp U.S. reaction. In its February 2006 Quadrennial Defense Review Report, the U.S. Department of Defense stated: “Internationally, the United States welcomes Russia as a constructive partner, but views with increasing concern its sales of destructive weapons technologies abroad” [6]. U.S. officials allege that Russia’s restrictions on arms sales are much weaker than those of Western countries, especially regarding authoritarian governments accused of massive human rights violations. U.S. officials worry that Russia’s arms sales to China are accelerating the PLA’s modernization and altering the military balance in the Taiwan Strait in Beijing’s favor. This shift could harden Beijing’s stance towards Taiwanese autonomy, facilitate another Chinese decision to threaten military force against Taipei and heighten the risk of another Sino-U.S. military confrontation over Taiwan. For this reason, the Bush administration has also made strenuous efforts to prevent the European Union from lifting its embargo on arms sales to China.

These U.S. concerns about Russian arms sales to China—even if endorsed, albeit less vocally, by India and Japan—are unlikely to determine Moscow’s policy. Russian officials consistently insist that they follow all applicable international laws and United Nations resolutions regarding the export of military technology. They argue that Russian exports involve primarily defensive weapons that will not disrupt the regional balance of power. They also observe that the United States and its allies transfer large volumes of weapons to many areas of conflict, including South Asia and the Middle East. Finally, Russian representatives argue that foreign protests often reflect a desire to eliminate unwelcome Russian competition or curtail Russia’s influence in important regions, such as East Asia. They repeatedly claim that, if they do not sell weapons to a particular country, another foreign supplier will. Last year, the head of Rosoboronexport, the state enterprise that manages approximately 80-90% of Russia’s foreign military transactions, said, “Let’s have no illusions: if we stop sending arms to export, then someone else will do it” [7]. In March 2006, Russian Defense Minister Sergey Ivanov said, “I often hear criticism that one must not sell weapons to certain states or regimes; according to this logic we cannot sell anything.” Ivanov elaborated on the “double standard” theme by telling journalists that the United States exported twice as many military weapons to foreign countries, including many undemocratic regimes, as Russia exported [8].

A more substantial factor weighing against a Russian decision to transfer even more advanced military systems is that Chinese engineers might learn enough from the technology to further improve the quality of their indigenous production. Russian analysts cite past instances when Chinese technicians copied Russian weapons systems and after making slight adjustments in their parameters (e.g., changing the caliber of an anti-missile system from 100 to 105 millimeters), sold them for export [9]. Russian defense firms already have confronted increasingly unwelcome Chinese competition in third-country arms markets, such as Egypt and Myanmar. In some developing countries that previously bought predominantly Soviet arms, Russian firms have yielded much of the market to lower-cost Chinese suppliers. If China is finally able to develop advanced indigenous weapons systems for export—like the long-awaited J-10 multi-purpose fighter plane—China could become an even more formidable competitor. During negotiations in early November 2006, fears of helping Chinese competitors led Moscow to resist granting Beijing a license to deliver less advanced FC-1 fighter planes, equipped with Russian engines, to Pakistan.

In addition to the troubling prospect that the PLA could use Russian technology in a future war with Taiwan, India or the United States is the even more disconcerting increase of Sino-Russian security cooperation in other dimensions. In Central Asia, Moscow and Beijing have worked through the Shanghai Cooperation Organization to promote anti-Western policies in the region (China Brief, June 21). Although the nominal focus of “Peace Mission 2005” was on combating terrorism and restoring peace among hypothetical local combatants, the exercise involved large-scale air, sea and ground operations with Chinese submarines, Russian strategic bombers and 10,000 troops from both countries—the kind of forces more suited for a major conventional military operation. While Beijing and Moscow insist they have no plans to establish a formal military alliance, their strengthening partnership though exercises and arms sales could impede the realization of a number of U.S. objectives in Asia in coming years.

Notes

1. For a list of major Russian-Chinese military transactions see Alyson J. K. Bailes, ed., SIPRI Yearbook 2006: Armaments, Disarmament and International Security (Oxford: Oxford University Press, 2006), p. 494-495.

2. Alexeksey Nikol’skiy, “$300 mln za aviadvigateli,” Vedomosti, July 11, 2005.

3. Vladimir Ubran, “Posledniy rekord rossiyskogo oruzhiya,” Moskovskie Novosti, June 17, 2005. The U.S. Department of Defense also concluded that the Russians might have been exploiting the exercise to show off advanced weapons systems to potential Chinese buyers; see Office of the Secretary of Defense, Military Power of the People’s Republic of China 2006 (Washington, DC: U.S. Department of Defense, 2006), p. 2.

4. SIPRI Yearbook 2006: Armaments, Disarmament and International Security, p. 454.

5. Igor Gaidar, “Yadernyy balans: opasnye igri,” Vedomosti, March 30, 2006. The controversial article asserting that the U.S. strategic buildup was in the process of negating Russia’s and China’s nuclear deterrents was Keir A. Lieber and Daryl G. Press, “The Rise of U.S. Nuclear Primacy,” Foreign Affairs (March/April 2006).

6. U.S. Department of Defense, Quadrennial Defense Review Report (Washington, D.C: February 6, 2006), p. 29.

7. Cited in Oliver Bullough, “Russia Goes Its Own Way in Selling Arms,” Moscow Times, June 20, 2006.

8. “Sergey Ivanov otvetil na obvineniya SShA v ‘bezdumnom rasprostraneniie oruzhiya’,” Izvestia, March 28, 2006.

9. Chzhan Ikhun, “Russko-Kitayskogo torgovlya po oruzhiya razvivaetsya,” Vremya Novostei, May 27, 2003. For other evidence that Chinese engineers have succeeded in copying Russian military technology for use in China’s own defense industry see Alyson J. K. Bailes, ed., SIPRI Yearbook 2005: Armaments, Disarmament and International Security (Oxford: Oxford University Press, 2005), p. 423-424.