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Home News Conventional Arms Russia, France Enter Talks on Sale of 4 Warships
Russia, France Enter Talks on Sale of 4 Warships
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Business Week, 1 Mar 2010.

Conventional Arms

France and Russia started exclusive talks today over the sale of four Mistral-class amphibious assault ships in what would be Russia’s first big-ticket purchase of military hardware from a North Atlantic Treaty Organization country since the Cold War.

“This is a symbol of trust between our countries,” Russian President Dmitry Medvedev said today during a joint press conference with French President Nicolas Sarkozy in Paris.

Responding to concerns the ship could be put to use against Russia’s neighbors, such as Georgia and Baltic countries, Sarkozy said the Cold War era was over. He called for increased trust in Russia, adding that he considers Russia a “strategic partner” and a “friend of France.” Medvedev, starting a three-day state visit in Paris, is seeking to boost Russian- French relations, signing energy and transport deals and engaging in defense sales talks.

The French government has said in recent months that the proposed sale was a logical extension of NATO’s repeated expressions of desire to work with Russia as a partner, not as an enemy.

“If Russia makes such a large military purchase from a NATO country, it means it does not see the alliance as a threat,” Ruslan Pukhov, director of the Center for the Analysis of Strategies and Technologies, a Moscow-based defense research company, said by phone. “It is more eloquent than any declarations in a military doctrine.”

‘Good Agreement’

Sarkozy said a “good agreement” would see two of the ships built in France and two in Russia. The Mistral is a 200 meter (656 foot) ship, capable of transporting as many as 700 combat troops, 16 helicopters and 60 armored vehicles. DCNS, the French government-controlled shipbuilder, would participate in construction of at least two of the vessels.

Six U.S. senators wrote to France’s ambassador to the U.S. in December to protest the proposed sale of the first ship, Foreign Policy magazine reported at the time. Sarkozy said the four vessels wouldn’t be sold with weapons and armament.

“The sale of the warship would set a precedent,” said Thomas Gomart, director of the Russian center at the Paris-based Institute for International Relations. “It would open the possibility, in the future, for Russia to buy more sensible armament.” The price of one Mistral vessel is estimated around 500 million euros ($678 million), he said in a telephone interview.

Iran Sanctions

Separately, Medvedev said today he would support new sanctions on Iran through the United Nations Security Council “if the sanctions are thoroughly thought out and intelligent.”

“Unfortunately all our attempts to convince Iranian leadership, our calls to work on the peaceful nuclear program under control of the global community so far didn’t bring results,” he said. “Russia is ready with our other partners to consider the issue of introducing sanctions.” He called for sanctions that wouldn’t hurt civilians.

Sarkozy, pressing his counterpart to back a new round of sanctions, said these would be “efficient and intelligent.”

Iran’s suspected work on designing a nuclear weapon is the main topic at a UN meeting today, with the UN’s top atomic diplomat saying investigators are unable to confirm that the Gulf country isn’t making a bomb.

The UN’s nuclear watchdog, the International Atomic Energy Agency’s 35-member board of governors, is in Vienna for a meeting that may run until March 4. Agency inspectors reported on Feb. 19 that Iran enriched uranium to 19.8 percent, 0.2 percentage point below the 20 percent threshold needed to start the chain reaction seen in an atomic weapon.

Business Agreements

Before the two presidents’ joint press conference, company executives signed several business agreements.

Alstom SA agreed to buy 25 percent in Russian rail- equipment maker Transmashholding. Alstom, based in Paris, said the purchase of a 25 percent stake plus one share in Breakers Investment BV, the parent company of Transmashholding, is subject to unspecified conditions, to be met within six months. Once these conditions are met, Alstom will make a first payment of $75 million to TMH, and the balance will be paid in 2012, based on TMH’s results for the 2008-2011 period.

GDF Suez, owner of Europe’s biggest natural gas network, signed a deal with OAO Gazprom to join the Nord Stream pipeline project connecting Russia and Germany via the Baltic Sea. OAO Gazprom may boost gas supplies to GDF Suez by 1.5 billion cubic meters a year from 2015 via the Nord Stream pipeline, the gas companies said today in a joint e-mailed statement.

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