Global demands and realities weaken the ineffective U.S. sanctions against Russia while Washington needs Moscow's cooperation on Afghanistan.
The MI-17 is the most widely used twin-engine helicopter in the world, with more than 60 countries using the machine for military and civilian purposes. One of these nations is Afghanistan, which should thank the American people for bankrolling several orders of MI-17s from Russia since 2011.
There was always tension about the deals signed by the Pentagon and Rosoboronexport, the sole exporter of Russian arms. In 2006, the company was sanctioned by U.S. government over its dealings with Iran, staying on the black list for four years. Having finally satisfied Washington's guidelines on Iran, Rosoboronexport's troubles in the West continued as the situation in Syria deteriorated: the Russians are still supplying arms to top client Bashar al-Assad.
Meanwhile, the war in Afghanistan helped create additional demand for Rosoboronexport's weapons arsenal, including the MI-17. In 2010, there were approximately 300 MI-17s in use by coalition forces and private military & United Nations contractors in Afghanistan, boosting demand and driving the price of a brand-new machine from $3.5 to $10 million. A year later, the Pentagon signed its first contract for MI-17 with Rosoboronexport, spending $900 million on the purchase and maintenance of 21 helicopters for the Afghan army.
"American military officials have made it clear that they need our helicopters, which are reliable and meet all of the requirements. This is the best advertisement our helicopters can get," said Vyacheslav Dzirkaln, deputy director of the Russian Federal Service for Military-Technological Cooperation.
The Pentagon backed Dzirkaln's sentiment, spending another $174 on 10 more helicopters in 2012. Retired Lt. Gen. David Barno, head of US and NATO forces in Afghanistan from 2003 to 2005, likens the MI-17 to the "Ford F-150 pickup truck": easy to use, easy to fix and suitable for the conditions in Afghanistan, where the helicopter was first used by the Soviet forces back in the '80s.
"They're like farm tractors -- they're simple to operate, simple avionics, simple to maintain," said Barno to a reporter from the Christian Science Monitor.
According to the CSM story, the Pentagon is quietly asking U.S. Congress to not undermine their efforts in Afghanistan by punishing Rosoboronexport with sanctions in the wake of the standoff in Ukraine. Secretary of State Kerry promised a new round of sanctions if Russia "does not de-escalate tensions in east Ukraine," though the Kremlin denies all claims that it controls or influences the separatist militias there. Mr. Kerry's predecessor, Hillary Clinton, said the sanctions should be "tightened and widened" to prevent the crisis from escalating.
U.S. lawmakers will happily abide by these requests: In April, a bill calling for $1 billion in loan guarantees to Ukraine and sanctions on Russia passed in the House with a vote of 378-34 and in the Senate with a 98-2 vote. The bill was signed by President Obama, the Russians ridiculed the sanctions and changed nothing in their stance on Ukraine.
Vice President Biden went to Kyiv this week to show that Washington wants to be a "partner and friend" to the new government, offering an extra $50 million to back his words. That's half the amount the U.S. would have to pay Russia if the Rosoboronexport contract is broken, according to Lt. Gen. Michael Williamson, the Army's new top uniformed acquisition official who gave Congress an estimate of "upwards of about $100 million" in incurred costs and fees for breaking the contract.
Still, U.S. sanctions keep getting closer to Vladimir Putin's inner circle, which includes Sergey Chemezov, CEO of the state-run Rostec Corporation and former director of Rosoboronexport, a part of Rostec. Mr. Chemezov and Vladimir Putin became friends in East Germany, where they both worked in the KGB.
Yet it is the Kremlin that holds a winning hand at the moment. They've withstood the initial round of sanctions, which barely affected Russia's elites who laughed at visa bans by promising to vacation in Crimea and were prepared for asset freezes after Vladimir Putin implemented a ban on officials' foreign bank accounts in 2013. The Kremlin knows that the suggestion by some U.S. congressmen to replace MI-17 with the more expensive and complicated Boeing CH-47 Chinook is unrealistic and would find no support in Afghanistan. Furthermore, the Russians are holding a trump card in the high-cost Ulyanovsk NATO transit base, already threatened to be put in play by Moscow. The Manas transit center in Kyrgyzstan, a Russia ally, is set to close in July this year after 14 years in operation. The Pentagon will be worse off with these shrinking options.
Even President Obama conceded that new sanctions may not change Vladimir Putin's geopolitical calculations. They won't. And with $100 million and the Afghan pullout at stake, the Pentagon should continue lobbying to keep Rosoboronexport in the clear with U.S. Congress.
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