China turns to Russia for Phalcon alternative

MOSCOW — China, stung by U.S. pressure to stop an Israeli sale of the Phalcon system, appears to have given final agreement for the purchase of a Russian alternative, the A-50E.

Defense sources in Moscow said the agreement was reached during a visit by Russian Prime Minister Mikhail Kasyanov to Beijing earlier this month. The accord calls for the Russian delivery of four A-50 early-warning aircraft to China in an $800 million deal.

No agreement has been announced. But the sources said the A-50E could be ready by 2004.

The sources said the four A-50s will serve China until Russia completes the more advanced A-50E model, which is said to be comparable to the most advanced systems in either Israel or the United States. The deal, estimated at $1.2 billion, involves a pledge by Moscow to end a dispute over debt by the former Soviet Union.

Russian defense sources said China could expand the deal and participate in Russia's Glonass satellite-based global navigation system as well as acquire Kamov helicopters, air-defense systems, surface-to-air missiles, multiple rocket launchers, artillery systems and infantry fighting vehicles.

The Russian deal appears to end Beijing's hope for revival of the sale of the $250 million Israeli Phalcon to China. In July, the United States blocked the sale of the Phalcon system, produced by the state-owned Israel Aircraft Industries. The Phalcon was to have been installed on an Il-76 transport plane supplied by Russia.

The A-50E agreement also appears to signal cooperation by the defense industries in China and Russia. Russian companies comprised more than 20 percent of the 350 firms that exhibited at the China air show, which ended on Sunday.

On Wednesday, Chinese President Jiang Zemin and his Russian counterpart, Vladimir Putin, agreed to cooperate on missile issues. This included continued opposition to U.S. plans to develop a national missile defense system.