Russia concludes deal with Iran for missile defense system

RIA Novosti reported that Russia has concluded a deal with Iran for the sale of long-range missile systems. Russian-owned Rostec chief executive Sergei Chemezov was quoted at the Dubai Airshow stating that the deal for the S-300 surface-to-air missile defense system was already signed. Observers note that the contract has the potential to alter the balance of power in the Middle East, citing US, Israeli and Arab state concerns about Tehran’s alleged expansionist agenda and military activities in the region.

Chemezov stated that Saudi officials repeatedly approached Rostec representatives to request they not sign the deal to supply Iran with the advanced missile defense system. The $800 million contract was concluded in 2007 but frozen by Russia in 2010 after pressure from the West over sanctions against Iran. Putin lifted the ban on arms export to Iran in April 2015, and deputy foreign minister Mikhail Bogdanov reported in August that the deal had already been resurrected. Iran has promised after the first delivery of missiles to revoke a $4 billion lawsuit filed at an international court in Geneva against Russian arms exporter Rosoboronexport. Analysts have highlighted the S-300 systems’ potential to enhance Iran’s military capabilities, emphasizing they would give Iran the ability to track civilian aircraft in the Persian Gulf and preempt any attacks on nuclear sites in the country.

The deal comes as part of substantial Russian activity at the Dubai Airshow. Rostec also concluded a deal with Indonesia for the sale of Sukhoi Su-35 aircraft, after the Indonesian Ministry of Defense reported in September that it would buy 16 of the Russian-made aircraft. The head of Russian Helicopters, owned by Rostec, told Reuters at the Dubai Airshow that military conflicts in the Middle East and elsewhere are predicted to offset falling demand for helicopters linked to low oil prices. A spokesman for Sukhoi Civil Aircraft Company, part of Russia’s United Aircraft Company, was also quoted by Reuters stating that it plans to boost production by three times by 2020, and is in talks with Egypt, Iran, Qatar, Oman and Saudi Arabia for sales of its regional Sukhoi Superjet 100.

Follow us on Twitter: @SteppeDispatch

News Briefs:

  • The National Bank of Kazakhstan has prohibited individuals and small trading companies from participating in the Kazakhstan National Stock Exchange (KASE), limiting participation to the National, commercial and national Development banks in order to keep the market from rampant speculation that could further destabilize the tenge, Kazakhstan’s national currency. Tengrinews quoted KASE vice chairman Andrei Tsalyuk stating the tenge’s strict regulation does not allow for the greater risk implicated in giving bank customers direct access to the currency market, as has been done previously on the Moscow Stock Exchange. The National Bank holds a 50.1% share in KASE, and retains the right to veto KASE decisions on regulation of the tenge and Kazakhstan government bonds market. KASE spokesmen have previously cited ambitions to become the region’s foremost stock exchange and an international competitor to London.