“Defense News” reports that the Israel-Russia intellectual property treaty signed in early March will likely pave the way for the Phalcon sale to India. The Phalcon AWACS, built by Elta Electronics Industries, uses Israeli electronics on the Russian-built Il-76.
The treaty, signed after several months of intensive negotiations, requires Israel to notify Russian defense contractors about every Israeli initiative to upgrade or export Russian-built weapons platforms.
Under the treaty, Israel will not pay royalties, as originally demanded by Moscow. However, Israel must provide Russia with complete information about any planned deal involving Russian-built weapons platforms, i.e. there will be complete transparency. Israel has also promised to collaborate with Russian companies in deals involving Russian-built equipment.
An Israel source told “Globes” that the first test of the new treaty will be the plan to sell up to three Phalcon AWACS planes to the Indian Air Force for $750 million. The deal has been in abeyance, due to Russia’s refusal to supply Il-76 planes, the system’s platform.
Government officials and defense industry sources said the Israel-Russia treaty applies only to future initiatives, and was not retroactive.
Israeli sources said that almost a third of defense sales since 1991 involved Russian military equipment. The aggregate value of these deals exceeds $6 billion.
Published by Globes [online] - www.globes.co.il - on March 18, 2003