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On Sept 30/08, “The USA’s National Cybersecurity Initiative” focused on the belated but growing reaction to recent uses of cyber-attacks as an adjunct to warfare, and by the growing rate of attempted intrusions into American systems from countries like China. In June 2008, “Secure Semiconductors: Sensible, or Sisiphyean?” discussed the growing realization within the US military that massive use of commercial electronics, coupled with the complexity of modern chip designs, made it very difficult to be sure that “backdoors” and other security flaws weren’t being inserted into high-end American defense equipment. It’s a difficult conundrum, because commercial chips offer orders of magnitude improvements in cost and performance. Hence DARPA’s “Trust in IC” program, which hopes to crack the problem and offer the best of both worlds.

On Oct 2/08, Business Week’s in-depth article “Dangerous Fakes” claimed that a key component of the silicon security threat might be even simpler:

“The American military faces a growing threat of potentially fatal equipment failure – and even foreign espionage – because of counterfeit computer components used in warplanes, ships, and communication networks. Fake microchips flow from unruly bazaars in rural China to dubious kitchen-table brokers in the U.S. and into complex weapons. Senior Pentagon officials publicly play down the danger, but government documents, as well as interviews with insiders, suggest possible connections between phony parts and breakdowns…. Potentially more alarming than either of the two aircraft episodes are hundreds of counterfeit routers made in China and sold to the Army, Navy, Air Force, and Marines over the past four years. These fakes could facilitate foreign espionage, as well as cause accidents. The U.S. Justice Dept. is prosecuting the operators of an electronics distributor in Texas – and last year obtained guilty pleas from the proprietors of a company in Washington State – for allegedly selling the military dozens of falsely labeled routers…. Referring to the seizure of more than 400 fake routers so far, Melissa E. Hathaway, head of cyber security in the Office of the Director of National Intelligence, says: “Counterfeit products have been linked to the crash of mission-critical networks, and may also contain hidden ‘back doors’ enabling network security to be bypassed and sensitive data accessed….”

F-CK-1A/B Ching-Kuo
(click to view all 3)

The Taipei Times passes along a China Times bulletin noting that The Aerospace Industrial Development Corp (AIDC) based in Taichung has upgraded two of the Republic of China Air Force’s 130 F-CK-1 Ching-Kuo Indigenous Defense Fighters “to improve their combat-capabilities against China.” The modified parts include the Ching-Kuo’s avionics, fire-control system and landing gear, said the paper, and the two modified IDFs will make their formal debut on October 10, 2006. Upgrades of the other 128 aircraft will follow.

If the money to do so is approved. A recent Flight International report notes that this has not happened, even as a major Taiwanese arms request that includes 66 F-16C/D fighters remains stalled in Washington…

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F-22: Climbing Mt. Fuji?
(click to view full)

Back in February 2006, InsideDefense.com’s Inside The Air Force (ITAF) reported that momentum was building within the Air Force to sell the ultra-advanced F-22A Raptor abroad to trusted U.S. allies, as a way of plussing up numbers and production. The USAF originally initially intended to purchase 700-800 F-22 fighters, but that was cut to 442, then 381, and recently cut again to just over 180. These cuts have had obvious effects on the cost per aircraft, and on the ratio of aircraft to total R&D + production money spent. With F-22 production set to terminate around 2010, and increasing concern over the capability gap between other US fighters and global competitors like the SU-30 family, MiG-35, et. al., some USAF planners are becoming concerned. Extending the F-22 production line through exports is also a way of extending the USA’s decision options.

One of the most likely export prospects is Japan. The Japan Air Self-Defense Force (JASDF) currently has 3 fighter jet models in its fleet: F-15J/F-15DJ Eagles, its F-4EJ “Kai” and RF-4EJ reconnaissance Phantom IIs, the Mitsubishi F-2s (a larger, longer-range variant on the F-16C). The Mitsubishi F-1 entered service in 1978 and is still listed on the JASDF web site, but it has now been replaced by F-2s¹. The JASDF introduced the F-4EJ in 1973, and the RF-4EJ version is slated for replacement by F-15Js with special pods. Japan has indicated it will begin retiring the F-4 platform entirely early next decade., which gives the Japanese a number of choices to make – and the F-22 is currently at the top of their list.

While the Raptor was discussed at a 2007 summit meeting, there are reports that “Pro-China officials in the White House and Pentagon are quietly undermining Japan’s request.” Meanwhile, BAE Systems is looking to pounce if the US continues to be intransigent…

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FC-1/ JF-17
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Back in January 2007, DID wrote:

“The military world has no shortage of irony. The defense industry has its moments too, as Pakistan just discovered. An aircraft whose development was driven by military sanctions from the US and Europe is now derailed by military sanctions. This leaves the Pakistani Air Force dependent on an alternative from… America. Meanwhile, the Chinese are left with no export launch customer for a plane they may now have to reluctantly buy themselves, instead of the favoured and more capable J-10. Somewhere in Delhi, champagne is pouring – but first, a bit of background.”

The arms market also features no shortage of change. The agreement India thought it had, was reversed by Russian autocrat Vladimir Putin. Now Pakistan has begun to take delivery of the new fighters, and is reportedly seeking additional agreements with Western firms for avionics and weapons upgrades. In addition, a joint marketing agency has been set up in conjunction with China…

• The JF-17 Thunder, aka. FC-1 Fierce Dragon
• Stuck in Sichuan: The Saga
• Updates and Key Events [updated]
  
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Galileo concept
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Large space projects with long lead times can be politically perilous. The USA’s Transformation Satellite Network (TSAT) aims to create a system that can deliver fiber cable class bandwidth to or from any point on the globe, using lasers as the space transmission backbone. Funding and technical progress issues have pushed the project back from its originally intended date of 2008-2009 to likely operation in 2014 or so – and doubts are emerging re: the entire $20+ billion project.

Across the Atlantic, the European Union is cooperating with China and other outside investors to replace the USA’s free Global Positioning System service with an alternative under their own control. Organizational issues and shortfalls in expected progress have pushed the “Galileo” project back from its originally intended operational date of 2008 to 2014 or so – and doubts have manifested in Europe re: the entire project, even as security issues around Chinese involvement and their forthcoming COMPASS satellite system persist.

The EU has decided to press on, however, and has gained initial-stage approval for its plan to finance the program with tax dollars instead of the expected private investments. Mindful of the pitfalls in this approach, however, they have decided to raid other EU accounts for over EUR 3 billion (about $5.35 billion) in funds, rather than asking for more money from member states. This has not gone over well in all quarters. Britain’s multi-party Parliamentary Transport committee, for example, released a stinging report that recommended scrapping Galileo unless key deliverables are met. The EU’s structure allowed it to brush those objections aside, however, and the organization is well on the way to approving the new arrangements and beginning to issue contracts. Meanwhile, key technical protocols are released for discussion, a second satellite is planned for launch in April 2008, and an influential American think-tank raises security and policy concerns that could have broad impacts on transatlantic defense industry relationships.

• What Is Galileo?
• “Eppur, Si Bloccare”: Trials & Tribulations
• Contracts and Key Events
• Appendix A: The EU Proposal – Going Forward ( ? )
• Appendix B: Additional Readings
• Appendix C: Additional Readings – The Security Dimension
  
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Red flag to a
bull defense market

As was the case in the communist Soviet Union, China’s official military budget and real military budget are not the same thing. Many items are hidden under other ministries, or simply not reported truthfully in the absence of accountable government. Official figures are given, however, and for the last 2 decades those figures have shown uninterrupted double-digit increases. Hot on the heels of the Pentagon’s release of its Congressionally-mandated “Military Power of the People’s Republic of China 2008” [PDF] report, Chinese “People’s Congress” spokesman Mr. Jiang Enzhu announced an 17.6% increase in China’s 2008 military budget, to 417.77 billion yuan ($58.81 billion). The increase follows a 17.8% increase in 2007, and a 14.7% increase in 2006.

1996-2007
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The real math, of course, lies in compound interest; over 20 years, an increase averaging 10% per year would grow a budget to 6.7 times its original size; at 12.5% per year, the figure is 10.5 times, and at 14% per year the budget would be 16.4 times its original size. Military modernization programs appear to be accelerating in step, including reports that China’s navy has already announced plans to build its first aircraft carrier by 2010. While estimates regarding the true size of China’s military budget vary…

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Eros-A pic,
Cape Canaveral
(click to view full)

In 2005, issues regarding Israeli weapons exports boiled over between Israel and the USA. Israel’s status as an observer in the F-35 Joint Strike Fighter program was suspended until a resolution in 2006 resulted in the USA assuming de facto veto power over all Israeli exports – even those that do not use American technologies, and fall outside of ITAR as non-military items, but could have potential security implications.

Israel’s canceled $100 million deal to upgrade Venezuela’s F-16s at a time when America was still shipping spare parts is often touted as the first example of that covenant in action. A more recent illustration of that covenant’s effects was recently provided when China sought to purchase time-share use of an Eros-B satellite from the ImageSat International (ISI) joint venture. IAI’s Eros series is derived from Israel’s Ofek-5 military satellite, and provides sub-1.8m imaging similar to France’s Spot satellites, and Space Imaging’s IKONOS. Although the Eros is not classified as a military item, the ISI Satellite Operating Partner (SOP) program allows images to be streamed directly to a customer’s ground stations, and it was submitted for review – a review that may yet scupper the deal…

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Chinese J-10
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DID’s Benelux reader David Vandenberghe tips DID to the original RIA-Novosti report that Iran has signed a contract with China for the delivery of two squadrons (24) of its J-10 fighter planes, which are powered by Russian engines and avionics. Representatives of the Iran Aircraft Manufacturing Industrial Company said China would deliver the jets during the in 2008-2010 time frame. Novosti adds that “Experts, estimating one fighter at $40 million, put the contract’s value at $1 billion.” Iran’s most advanced fighters are currently MiG-29s, many of which once belonged to Saddam Hussein and fled to Iran during the 1991 Desert Storm war, and a handful of F-14 Tomcats that have been ingeniously maintained over the years.

The Chinese J-10 is based on plans sold by the Israelis in the 1980s, after their Lavi fighter program had been canceled. The massacre at Tiananmen Square ended cooperation with western aerospace firms, however, forcing China to install Russian AL-31FN engines instead of American F100/F110s. This in turn forced a slew of alternations owing to changes to the aircraft’s new inlet requirements, weight distribution, center of gravity, et. al. Russian avionics with their own set of space requirements also had to be installed and tested to replace American/Israeli equipment, which led to further design changes. Then there were the indigenous Chinese efforts, including the Type 1473 pulse-Doppler (PD) fire-control radar to replace Israel’s Elta or the American APG-68. The end result entered service in 2003 after well over a decade in development, and is a rather different aircraft than the Lavi. Nonetheless, it retains the aircraft’s canard-delta layout and some of its capabilities, and its aerodynamic layout and known/reported characteristics suggest an aircraft that is equal or slightly superior to American F-16 C/Ds. This could complicate Israeli strikes on targets related to Iran’s nuclear program, though many other variables would also come into play for such scenarios.

If the deal pans out at all… recent reports have thrown it into question.

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BTR-3
(click to view full)

Thai Defence Minister Boonrawd Somthas recently suspended a controversial arms deal announced in mid-August 2007 between Thailand and Ukraine, bringing the purchase of 96 BTR-3E1 wheeled armored personnel carriers (APCs) for Bt4 billion (about $117.6 million) to a halt. The BTR-3E1 amphibious armored personnel carriers had beaten APC contenders from China, Russia, and Canada to win the Thai order, and a recent request from Iraq would make 9 customer countries if the Thai order goes through. BTR-3s are built by an international consortium led by the United Arab Emirates’ ADCOM MANUFACTURING Company Ltd. WLL, in partnership with Ukrainian firms Kharkiv Morozov Machine Building Design Bureau, and the State Scientific Technical Centre of Artillery & Rifle Arms. Jane’s describes the BTR-3 as:

“a more recent design [than the BTR-80] with a raised roof for greater internal volume… powered by a locally developed UTD-20 diesel coupled to a manual transmission. Armament consists of the Shturm combat module armed with a locally produced 30mm ZTM-1 cannon, 40mm automatic grenade launcher, 7.62mm machine gun and twin launcher for Barrier ATGW with a maximum range of 5,500m. The vehicle is fully amphibious, being propelled in the water at a speed of 8-10km/h.”

Stryker APC in
Mosul traffic jam
(click to view full)

The BTR-3E1 deal has caused a rift in the Defence Ministry, pitting the (now transferred to an inactive post) Admiral Banawit Kengrien against army chief (and now Deputy Prime Minister) Sonthi Boonyaratglin. Questions have also been raised about the Ukrainian firm’s inclusion in the competition, pointing out that they didn’t submit their bid by the deadline. The Office of the Auditor-General chimed in with its own report, questioning including whether the Ukrainian APC has a proper after-sale maintenance agreement, and whether it was in line with national procurement policy. The current army chief, Gen. Anupong Paochinda, has said the army would accept any decision made by Defence Minister Somtas. The ministry has set up a committee to re-examine the deal.

This could be good news for General Dynamics Canada, whose amphibious LAV-II and non-amphibious LAV-III/Stryker vehicles are often mentioned as the Thai competition’s “higher quality, higher price” alternative. ‘Military experts’ complaining that a BTR-3 won’t stop an RPG-7 rocket should be aware that the LAV-III/Stryker won’t do so, either, however, unless it’s protected by cage armor. Which could also be fitted to the BTRs, in order to give them similar odds. Action Ukraine Monitoring Service report | Thailand’s “The Nation” report.

USMC LCpl Cheema & AK
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In September 2006, “Up to $750M in Weapons & Support for Iraq” described Iraq’s order for a number of American small arms, as well as helicopters and blast resistant vehicles. A subsequent update to that piece shed more light on the process Iraq used to select US weapons over the Soviet-derived alternatives that are so common in the country as a legacy of the Saddam era. There are some programs to refurbish those weapons, but the new direction seemed clear.

Iraq has just made a request for follow-on equipment, but US small arms manufacturers are finding that it’s hard to keep customers exclusively loyal if you can’t perform. Iraq continues to request US weapons, but the Washington Post reports that Iraq is also preparing to buy over $100 million in Soviet-derived small arms from… China. As the Post article notes:

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