Russians wrap up attractive deals


  • Business
  • Sunday, 10 Aug 2003

BY PAUL GABRIEL

PERSEVERANCE pays off, they say, and going by events here earlier this week, businessmen Dr Vladimir Sautov will swear by this.  

The burly Russian had arrived here from Moscow in an advance party of businessmen to prepare for Russian president Vladimir Putin’s visit scheduled on July 7.  

Everything was set for Putin’s historic arrival here when the trip was abruptly called off due to suicide bombing incidents in the Russian capital.  

The Russian head of state was to help pave the way for important business dealings with Malaysia, including addressing the Malaysia-Russia Business Forum at the Shangri-La Kuala Lumpur.  

Sautov, who is co-chairman of the newly formed Malaysia-Russia Business Council, did not lose heart. His trip was not in vain as he spent time networking with Malaysian businessmen and returned home with a strong-willed desire to be back – with Putin.  

As it turned out, the president’s delayed trip turned out to be a blessing in disguise for Russia’s business interests here.  

Putin arrived on Monday with a larger business delegation of 40, compared with the 15 in the initial team.  

The “extra time” gave the Russians an opportunity to fine-tune their proposals and work out a better business “package” with Malaysia.  

Sautov, a frequent visitor to Malaysia, left for home on Thursday morning a very happy man indeed. For him especially, it was more than a mission accomplished.  

“I am very pleased with the way things went, and Asli (Asian Strategy and Leadership Institute) put together a really fantastic business forum for us.  

“We had businessmen from various regions of Russia here and they included those in the aviation sector, banks, scientific industrial centres and consultancy firms.  

“President Putin’s visit proved vital for Russian business here and Prime Minister (Datuk Seri) Dr Mahathir Mohamad had a great message for us when he said that he wanted Russia to use Malaysia as a springboard for business in the region,’’ he said in an interview.  

Sautov, who is vice-president of the Irkutsk Aviation Industrial Association, had reason to be merry. His firm sealed a US$900mil (RM 3.42bil) deal to sell 18 Sukhoi SU-30 MKM jets, which will be delivered in stages between June 2006 and the end of 2007.  

This was a breakthrough deal as Russia has been long eyeing Malaysia as a market for its famous fighter jet, which was displayed at past editions of the Langkawi International Maritime and Air (LIMA) exhibitions.  

Irkutsk was also involved in deals with DRB-Hicom Bhd, which was handed three-year rights to distribute the BE-200 amphibious aircraft, and with Sapura for joint co-operation in developing and producing aircraft systems.  

The distributorship rights, awarded to the firm’s wholly owned DRB-Hicom Defence Technology Sdn Bhd (Deftech), covers the Asia Pacific region, with exclusive rights for the South-East Asian region.  

The BE-200 is a multipurpose aircraft that can be configured for aerial fire-fighting, search and rescue and ambulance services, besides being used for cargo and passenger transport.  

Set up in 1932, Irkutsk Aviation Production Association is one of the oldest defence enterprises of the Transbaykal region and most aircraft manufactured by the firm are brand new versions.  

Sautov said the Sukhoi aircraft to be sold to Malaysia would be an upgraded, custom-built version to suit local needs.  

Irkutsk, he added, was presently producing 50 Sukhoi-30MKI aircraft for India, adding that 140 more would be manufactured in India in what was a massive US$7bil (RM26.6bil) deal.  

“The Sukhoi is the most sophisticated fighter aircraft in the world. In Russia, we think it’s simply the best,’’ he said in his “hard-selling” business tone which has proven to be successful, yet again.  

“The aircraft for Malaysia and India will have vector engines, sophisticated Western avionics and weaponry with special radars to detect targets up to 380km away and pursue 12 targets simultaneously, with the possibility of hitting four of these at one time,’’ he continued.  

On the choice of DRB-Hicom to market the BE-200 amphibious plane, Sautov said Irkutsk was proud to be associated with the company, which he described as a serious and committed partner.  

“DRB-Hicom Deftech will act as our agent and be responsible for promoting the aircraft in the Asia Pacific region. The aircraft will be assembled in Russia but we are studying the possibility of expanding our co-operation with Malaysia in this area,’’ he added.  

Among the interesting features of the aircraft is its ability to land on and scoop water for emergency fire-fighting purposes.  

Several other important agreements were signed between Russian and Malaysian parties during Putin’s visit.  

Rosoboronexport clinched a deal with Airod on the purchase of Russian-made MI 171 transport and military helicopters, while the Russia-Asean Cooperation Fund signed an agreement with DRB-Hicom and Asli for strategic cooperation.  

Sautov said DRB-Hicom would represent the interest of the fund in Malaysia, with the fund reciprocating the role for DRB-Hicom in Russia.  

The Moscow-initiated fund’s main objective is to promote the national interest of Russia in the Asia Pacific region and to coordinate the efforts of Russian entrepreneurs and organisations.  

Since 1997, the fund has been networking with Malaysia to develop contacts between the business circles and had also organised large international forums here, which include the 1st Russian-Asean Business Forum.  

Sautov, who is the chairman and general director of the fund, said another notable agreement was the one signed between Vneshtorgbank and Bank Negara to open a US$50mil (RM190mil) credit plan for Russian businessmen to directly purchase Malaysian palm oil.  

He cited the biggest achievement as the setting in place of a proper mechanism for the further development of business ties between both countries.  

“The creation and inaugural meeting of the Malaysia-Russia Business Council here was a logical thing in the development of our business relations,’’ he concluded.  

All things said, there seems to be one certainty – Malaysians have certainly not seen the last of this enterprising Russian businessman with his “go, go, go” attitude. 

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