Mideast Weapon Sales Part of Long-Term Plan: U.S.

The final days of 2011 saw the Obama administration finalize two important weapon sales with countries in the Middle East: a $3.48 billion sale of a Lockheed Martin-made missile defense system to the United Arab Emirates, and a $29.4 billion sale of Boeing-made F-15 fighter jets to Saudi Arabia.

While the announcements come as tensions between the United States and Iran continue to rise over a dispute regarding access to the Strait of Hormuz, the deals themselves are not meant to address current events, State Department officials said.

The F-15 deal was finalized with Saudi Arabia on Dec. 24. However, the White House first notified Congress of that sale, which includes 84 new aircraft and the modernization of 70 existing aircraft as well as missiles, spare parts, training, maintenance and logistics, in October 2010.

During a Dec. 30 State Department news conference, Andrew Shapiro, assistant secretary of state for political-military affairs, told reporters that the deal was not directed toward Iran, adding that work on the sale precedes the latest news out of the region.

"We did not gin up a package based on current events in the region," he said.

Over the last several weeks, the United States and Iran have stepped up the economic and military pressure on each other, with the latest threat coming from Iran, which warned the United States not to return one of its aircraft carriers to the gulf.

On Jan. 3, the Pentagon dismissed Iran's warnings.

"The deployment of U.S. military assets in the Persian Gulf region will continue as it has for decades," Pentagon Press Secretary George Little said in a statement. "Our transits of the Strait of Hormuz continue to be in compliance with international law, which guarantees our vessels the right of transit passage."

Meanwhile, Undersecretary of State for Political Affairs Wendy Sherman is on a four-day trip to Saudi Arabia and the UAE.

"While in the gulf region, she will consult with senior Saudi and Emirati officials on a wide range of bilateral and regional issues," according to the State Department. Her trip "further illustrates the robust strategic relationship the United States shares with both Saudi Arabia and the United Arab Emirates."

While the latest sales to the Middle East are being placed in this geopolitical context, the late December announcements are not tied to the escalating tensions, but part of a longer-term security plan, said Danny Sebright, president of the U.S.-UAE Business Council and a counselor at the Cohen Group, Washington.

"The overall sales with regard to both countries are definitely the result of a long-term concern with Iranian intentions, a long-term concern with wanting to improve individual countries' defense capabilities," Sebright said. "But, is the announcement of these two deals specifically tied to Iran? I would say no to that. I would say it's much more about internal decision-making in both countries - some with regard to terms and conditions of the sale, some with regard to budgeting, and some with regard to the Arab Spring."

According to Sebright, the United States gave the formal Letter of Offer and Acceptance to Saudi Arabia last spring and the Saudi government has been holding on to it until it was ready to sign.

"The basic deal had all but been done over a year ago, but they waited for internal and external reasons," he said.

A State Department official said, "While we decline to get into the specifics on the negotiations, the timeline here is not particularly atypical. A sale of this magnitude and complexity required close, continual consultations with our Saudi and industry partners to sort out the details."

Congress was first notified of the plan to sell UAE the Terminal High Altitude Area Defense System (THAAD) in September 2008. After negotiating the details of the contract, the United States and UAE signed the THAAD deal on Dec. 25. Lockheed Martin is on contract for four THAAD batteries for the U.S. Army, but the UAE deal is the program's first foreign sale.

Lockheed Martin's portion of the $3.48 billion sale is $1.96 billion. The overall deal includes two THAAD batteries, 96 missiles, two AN/TPY-2 radars, and 30 years of spare parts, support, and training to the UAE, according to the Pentagon.

Since the 2008 congressional notification, UAE trimmed the buy.

At first it was expected the country would buy three THAAD fire units, 147 missiles, and four radar sets for an estimated value of $6.95 billion.

The United Arab Emirates has asked Lockheed not to publicly discuss the delivery schedule of the weapon system, said Dennis Cavin, vice president of corporate business development at Lockheed Martin.

"This sale is an important step in improving the region's security through a regional missile defense architecture, and follows a number of recent ballistic missile defense-related sales," Little said in a Dec. 30 statement.

Sales from earlier in the year include a $1.7 billion direct commercial sales contract to upgrade Saudi Arabia's Patriot missiles and the sale of 209 Patriot GEM-T missiles to Kuwait, valued at about $900 million.

Loren Thompson, a defense analyst at the Lexington Institute, also put the sale in the context of December's announcement that Iraq would buy Lockheed's F-16s and Oman's decision to double the size of its F-16 fleet.

"When combined with the modernization of the Saudi Air Force and the extensive F-16 inventory of the United Arab Emirates, it is clear Arab gulf states will be positioned to greatly outmatch the antiquated tactical aircraft fleet of Iran," he wrote in a blog for Forbes.

According to Lockheed Martin, demand for missile defense capabilities continues to climb around the world.

"With regional threats in the Middle East and the uncertainties of what's going on in North Korea, demand for a very capable missile defense system has never been stronger," Cavin said. "The U.S. government is in discussion with a number of countries who have expressed interest in the THAAD, but we'd prefer that the Missile Defense Agency address any specifics with regard to which countries have contacted them."

The Missile Defense Agency declined to provide further details.

In announcing the Saudi deal, the State Department emphasized it would improve interoperability between the Saudi and American air forces.

In addition to greater cooperation with the United States, the sales also bolster internal cooperation among the Gulf Cooperation Council countries, which include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, Sebright said.

The gulf countries have taken more steps to improve internal coordination and work toward multilateral defense policies in the last year than they have over the last 25, he said.

Lockheed Wins Contract for UAE Anti-Missile System

Washington - The Pentagon awarded U.S. defense giant Lockheed Martin Corp. with a $1.96 billion contract Dec. 30 to supply the United Arab Emirates with a missile defense system.

Under the contract, Lockheed will deliver two Terminal High Altitude Area Defense or Thaad systems that include radar, interceptors and launchers, according to a Pentagon statement.

The project is part of President Barack Obama's plans to build up a regional defense in the Middle East to counter Iran's growing arsenal of ballistic missiles.

Under the plan, land-based interceptors would be tied in with a detection network on U.S. Navy Aegis-class warships.

UAE is the first country to purchase the expensive Thaad system.

The announcement came amid rising tensions with Iran and a day after the United States confirmed the signing of a $30 billion arms deal to provide another Gulf ally - Saudi Arabia - with 84 new fighter jets.

Dassault Critiques Financial Logic of Gripen Pick

PARIS - Dassault criticized the financial logic of selecting the Saab Gripen after Switzerland selected the Swedish single-engine fighter jet over the competition rivals Eurofighter Typhoon and the French-built Rafale.

"The 'Swiss-tailored' Gripen only exists on paper. Its technical development and production risk significantly increasing the financial efforts required of the Swiss authorities to accomplish the country's fighter aircraft program," the Dassault-led Rafale International team said in a Nov. 30 statement.

The Rafale reaction came after Switzerland earlier announced it would buy 22 Gripen fighters to replace its fleet of F-5 Tigers.

A Rafale selection would have met the Swiss operational requirements with a smaller number of aircraft "at an equivalent or lower cost," the Rafale industrial team said. Those capabilities had been "demonstrated during the assessments by the Swiss Air Force," the statement said.

The Rafale team regretted that the Swiss authorities "knowingly decided not to position Switzerland at the highest European level as regards to the performance of the new fighter aircraft," the statement said, quoting the Swiss Federal Council.

Saab welcomed the Swiss selection of the Gripen.

"Given that Switzerland is known globally for applying (the) highest procurement standards and requesting state-of-the art technologies, Saab is both proud and delighted that Gripen has been chosen as the Swiss Air Force's future multirole fighter aircraft," Saab said in a statement.

"The Gripen program will create a long-term partnership between Switzerland and Sweden. Saab assures Switzerland a long-term strategic industrial co-operation aimed at creating sustainable high tech jobs, transferring technology and generating export business," the statement said.

The Rafale team said it had reached out to 250 Swiss companies to create a local industrial partnership in the 26 Swiss cantons.

The Swiss defeat follows a setback in the United Arab Emirates for the Rafale, with Dassault's bid described as "uncompetitive and unworkable," by the Abu Dhabi Crown Prince Sheikh Mohamed bin Zayed, who is also deputy supreme commander of the armed forces.

DoD Lax in Monitoring Weapon Sales to Gulf: Audit

WASHINGTON - U.S. authorities have failed to adequately monitor weapons sales to Persian Gulf countries criticized for dismal rights records or recent security crackdowns on protesters, a government audit said Nov. 18.
The Government Accountability Office pointed to "gaps" in how the State Department and the Pentagon monitor military equipment, including sensitive technology, after it is sold.

Rising tensions in the Middle East and North Africa between long-standing regimes and protesters seeking their removal triggered concern from government auditors, especially ahead of a looming $53 million arms deal with Bahrain.
Although the State Department has vetted hundreds of individuals and units set to receive U.S.-funded training in the Gulf to make sure the equipment will not be used for rights abuses, it has not done so for $188 million in assets due to reach Oman and Bahrain, the GAO said.
"Such vetting is especially critical given Bahrain's use of its security forces to quell public demonstrations since Spring 2011," it said, noting the lapses mean that sensitive technology such as night-vision devices are left "prone to diversion."
Earlier this year, Bahrain's Sunni monarchy crushed pro-democracy protests, spearheaded by the majority Shiites, with the help of troops from other Arab states in the Gulf, led by Saudi Arabia.
Twenty-four people died during the monthlong crackdown, according to official figures from Manama. Four protesters have since died in custody. The opposition said 40 people were killed.
Auditors also criticized the Defense Department for failing to document its efforts to verify the security and accountability procedures in countries receiving sensitive military equipment, while Pentagon staff in five of six Gulf countries did not document monitoring activities for less sensitive items.
"We need to ensure that the equipment is not being diverted to third parties, and that those groups and units who are the intended recipients are not implicated in human rights violations," said House Foreign Affairs Committee Chairwoman Ileana Ros-Lehtinen, R-Fla.
Gulf Cooperation Council countries - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates - are among the U.S. military's biggest clients, with some $22 billion in arms sales from 2005 to 2009.

M-346 Jet Trainer Crashes Near Dubai

An Alenia Aermacchi M-346 jet trainer crashed Nov. 18 near Dubai, a company spokesman said.
"A prototype M-346 aircraft owned by Alenia Aermacchi suffered an accident today while flying in United Arab Emirates air space on its return journey to Italy," wrote Alenia spokesman Jim Meltsner in an emailed statement. "The on-board crew successfully ejected from the aircraft, and no serious injuries were reported."

The UAE and company officials are investigating what happened, but there was no word yet on what caused the Italian-made twin-engine advanced jet trainer to crash.
"The causes of the accident are currently being investigated and, in accordance with company procedures, an internal investigation committee has also been set up," Meltsner wrote. "Alenia Aermacchi representatives are cooperating closely with the local authorities, through the Italian embassy in the United Arab Emirates."
A derivative of the M-346 called the T-50 is a potential candidate for the U.S. Air Force's nascent T-X program to replace the five-decade-old T-38 Talon advanced jet trainer.

Thunder rattles Gulf Specators

UAE Received Information on F/A-18, F-15

DUBAI - Boeing provided information earlier this year on its F/A-18 and F-15 combat aircraft to the United Arab Emirates (UAE) as part of the gulf state's "open fighter competition," said Dennis Muilenburg, president and CEO of Boeing Defense, Space & Security.
The data on the two fighter jets was supplied at the same time that Boeing supported government-to-government talks under the U.S. Foreign Military Sales regime, Muilenburg said.

"We're honored to have two great fighters to compete," Muilenburg told journalists at the Dubai Airshow here. "We've got hot production lines for both aircraft."
Boeing could provide cost and delivery certainty, and also ensure post-delivery logistical support for both aircraft, he said.
The Eurofighter consortium, meanwhile, confirmed in a statement that the U.K. responded to a UAE request for a briefing on the Typhoon fighter.
"The briefing took place on 17th October 2011," the statement said.
The U.K. then received a request for proposals for the supply of the Typhoon for the UAE Air Force.
"We are working hard to deliver a response," Eurofighter said.
The request for a Eurofighter bid came as a blow to the French government and industry, which have been hoping for a UAE contract for Dassault's Rafale fighter before the end of the year.
Lockheed Martin also has responded to the UAE's request for information on its F-16, which the U.S. company sees as a bridge to selling the F-35 Joint Strike Fighter to the gulf state.
Boeing hopes that moves aimed at boosting local UAE industry will help its fighter bid.
Boeing and Mubadala Aerospace, a unit of the Mubadala state-owned holding company, announced Nov. 14 they had agreed to two deals under a 2009 framework agreement to develop the UAE's civil and military aerospace industry.
Under the first deal, Boeing will establish local company Strata Manufacturing as a composite aerostructures supplier. Strata will be able to qualify as a tier 1 supplier to Boeing if it meets performance and competitiveness targets set in a so-called "strategic roadmap."
Secondly, the Advanced Military Maintenance Repair and Overhaul Center, a Mubadala Aerospace company, will work under a strategic agreement with Boeing Defense, Space & Security to provide support for military aircraft in the UAE, including Boeing-built Apache and Chinook helicopters and C-17 airlifters.
Boeing sees interest in the F/A-18 and F-15 in the gulf region, including Kuwait and Qatar.
A sale of F-15s to Saudi Arabia is under government-to-government discussion, after having sparked protest from Israel.

Lockheed To Demo Command System in Dubai

DUBAI, United Arab Emirates - Lockheed Martin was due this week to give a demonstration of its command-and-control product pitched in the United Arab Emirates' two-horse tender for an integrated air and missile defense system, a company executive said.
Lockheed Martin was very confident it could "meet or exceed the requirements for the system," Dennis Cavin, vice president of international air and missile defense, said Nov. 13 at the Dubai Airshow.

The U.S –based company and ThalesRaytheonSystems (TRS) are competing for an estimated $1 billion contract under the United Arab Emirates' extended air defense ground environment-transformation program.
Lockheed expects the Emirati authorities to carefully analyze and evaluate the competing offers and select the supplier, Cavin said. A selection decision is understood to be close, he said.
Lockheed also soon expects the country's reduced order for its Theater High Altitude Area Defense (THAAD) missile, Cavin said.
The decisions for the air and missile defense system and the THAAD procurement were not related, but Cavin said that the two Lockheed weapon systems, THAAD and PAC-3, being bought by the United Arab Emirates should be plugged into a command-and-control system offered by the same company.
The initial THAAD buy was valued at $6.95 billion when announced in 2008, but the United Arab Emirates has cut the number of units - and, therefore, the sale's value - by about one third.
TRS, a joint venture between Thales and Raytheon, has made several demonstrations of its product in recent weeks to Emirati officials as part of the tender process, a company executive said.
All technical information has been presented to the United Arab Emirates, and a selection could be made any time, the executive said.
TRS has a presentation display of its SkyView air C4I product on its stand at the exhibition. The display shows a map of France and a host of information tracks and symbols of the air environment with potential for tracking aircraft and missiles in the airspace.
The system features include mission planning and execution, as well as fusing of information from a variety of sources.
The down selection to Lockheed and TRS eliminated Boeing, Northrop Grumman and Saab, industry sources said.
"We respect the customer's decision making process," Dennis Muilenburg, president and chief executive of Boeing Defense, Space & Security, said.

UAE Also Eyeing Typhoon in Combat Aircraft Competition

DUBAI - The United Arab Emirates (UAE) has asked Britain to bid the Eurofighter Typhoon for its combat aircraft fleet competition, a British government spokesman said, dealing a blow to French efforts to sell the Rafale to the Gulf state.
"We have received the request for proposal for the Eurofighter Typhoon," an official from the U.K. Defense & Security Organization said Nov. 13 on the opening day of the Dubai Airshow. "We're working on it."

No figures were immediately available for the British bid.
The U.K. Minister for International Security Strategy, Gerald Howarth, was attending the exhibition as part of London's official support to place the Eurofighter in the UAE.
The British Chief of the Air Staff, Sir Stephen Dalton, was also in Dubai, flying the flag for the Royal Air Force, which flew two Eurofighters to the show. A Eurofighter was scheduled to fly in the daily display, as was the Rafale.
Dassault Aviation declined comment.
French Air Force officers heard of the Eurofighter news on Nov. 11, through a London embassy attaché.
The UAE has been in talks with France since 2008 on a sale of 60 upgraded Rafales, but the negotiations suffered political upsets along the way and Gulf officials saw the initial $10 billion tag as excessive.
On the Rafale talks, French defense minister Gérard Longuet told journalists here "the final stage has been well engaged and a flick of the eyebrows could mean hundreds of millions of euros either way."
Each side was defending its interests, but the talks were essentially between the Rafale commercial team and the UAE, he said.
The UAE's request for a Eurofighter bid was a case of "livening up the procedure," Longuet said, adding he still expected the UAE would order the Rafale in December when the Gulf state celebrated its 40th anniversary of founding.
An important price element was the Rafale's multirole capability, which meant the same crew could perform air combat, reconnaissance and close air support missions, Longuet said. For a country with a small population, that was a big saving in crew costs.
On the UAE's Mirage 2000-9 fleet, any decision in an "innovative solution" was a decision at the state level as part of a strategic relationship, above that of the ministry or manufacturer, he said.
Some Mirage 2000-9 units were aging, others were more recent, he said.
In the official opening of the show, UAE Prime Minister Sheikh Muhammad Bin Rashid Al-Makhtum made the briefest of visits at the Rafale stand in his tour of the exhibition.
Lockheed Martin has been in talks with the UAE on F-16 upgrades, mainly communications, to allow the U.S.-built fighters to talk to the F-35, F-16 business development executive William Henry said here.
In an upgrade that took units out of service, Lockheed offered sales of new F-16s to allow operators to maintain force levels, he said.
Lockheed also has talked to the UAE about sales of the F-35, Henry said.
"As air forces look to the future, the F-35 is going to be a key element of their force planning," he said.
Lockheed sees potential sales of 50 to 100 F-16s around the world, Henry said. On top of 18 F-16s ordered by Iraq, 52 units are on the backlog.
Maj. Gen. Ibrahim Naser Al Alawi, deputy commander of the UAE Air Force and Air Defense, told an air chiefs conference Nov. 12 that, in a new generation combat aircraft, the air force was looking for network capability, open architecture and interoperability.
A future weapon system would be versatile, multirole, and capable of handing modular sensors and payloads, Al Alawi said.
Other elements of the future aircraft would include upgradeable and expandable hardware and software, and the plane would be fast, agile and easily serviceable, he said.
The systems should also draw on dual use military-civil technology and offer versatility.
MBDA Chief Executive Antoine Bouvier said the European missile company has not received a request from Eurofighter or the UAE to work on an offer of weapons for the Typhoon.
The UAE Air Force flew its F-16 and Mirage 2000-9 fighters in the NATO-led coalition operation over Libya. Qatar also flew alongside with French missions.
That deployment yielded many "firsts," including the UAE's first time flying as a non-NATO member in a coalition air campaign, Al Alawi said.
Among the lessons learned from Libya were the need for integration of non-NATO elements into the alliance procedures, need for a well thought out communications plan among partner nations and the importance of exchange liaison officers, Al Alawi said.
The UAE is still in talks with the French government and industry for the Rafale, a Gulf source said.
UAE foreign minister Abdullah Bin Zayed Al Nahyan recently held a first meeting with his counterpart Alain Juppé, who has been tasked by president Nicolas Sarokzy to lead the export drive for the Rafale.
The request for a Eurofighter bid is the latest setback for France's Rafale foreign sale campaign. UAE officials asked Lockheed for information on the F-16s, on which the Gulf state has invested in co-development on its Block 60 version.
The U.S government was also out in force at the show, displaying the V22 Osprey tilt-rotor aircraft for the first time here, as well the F-15, F-16 and F-18 fighters. The Apache attack helicopter was also at the show.
Bilateral ties between France and the UAE were back to normal after a hitting a low patch last year, when the Gulf state viewed the Paris government as ignoring its concerns.

French Air Chief: UAVs Taxing Available Satellite Bandwidth

DUBAI - A move to a new standard communications band is needed because of a saturation of current bandwidth, French Air Chief of Staff Gen. Jean-Paul Palomeros said Nov. 12.
Increasingly relied-upon unmanned aerial vehicles such as Predators, Reapers and the French Harfang generate huge amounts of data, including full motion video, and complex sensors such as high definition video, laser designators, imaging radar, ground moving target indicators and multispectral imagers demand high bandwidth for transmission, Palomeros told an Air Chiefs conference ahead of the Dubai Airshow's Nov. 13 opening.

Planners estimate a large bandwidth is needed because of a "multitasking of UAVs," with many remote piloted vehicles being operated simultaneously, Palomeros said.
Some 20 gigabits per second is needed to cope with the growing number of UAVs, which are swamping the current Ku bandwidth available on satellite communications links.
"Ka band appears to me as an interesting option," even if the signals are much more sensitive to weather conditions, Palomeros said.
Some technology has been developed, dubbed adaptive codage modulation, that limits the weather's impact on the signal, but a good solution would be to get industry to furnish a dual-band Ku-Ka antenna, Palomeros said.
"This option allows us to benefit from the maturity of the Ku, while anticipating the potential benefits of the Ka-band," he said.
Among "pragmatic options" for boosting UAV efficiencies, Palomeros suggested:
■ Chat rooms between coalition UAV operators, to allow coordination of surveillance missions and to boost interoperability.
■ Greater training in simulation to improve joint operations of UAVs and to overcome "ignorance of UAV performance" among ground commanders.
■ Fuse and share imagery, communication and signal intelligence as a single intelligence chain of command; to think of intelligence as a "whole operational concept" and not as "different pillars."
■ Operate UAVs as elements of a distributed air operation in which the air vehicles work alongside manned aircraft such as the Rafale, so they contribute to the entire mission set of an air operation.
■ Co-locate experts in the same unit, so intelligence professionals can provide the best situational awareness in near real-time in their specific domain, and intelligence experts should deploy regularly to keep information up to date.
■ Develop software to allow automatic detection of "suspicious activity," although most of the time human intelligence and operational expertise will be more effective than sophisticated software.
■ Work on autonomous flight rather than target detection, with manual override for pilots on the ground to reroute.
As an example of the concept of operations to be expected in UAV use, Palomeros showed a video in which a Rafale pilot used data from a Predator UAV to cross cue the designation pod on the French warplane, allowing the pilot to locate and identify a target.

UAE to Build Integrated Air Ops Center in 2012

DUBAI - The United Arab Emirates (UAE) plans to build an integrated air operations center next year as part of a layered ballistic missile defense system, the deputy commander of the UAE Air Force and Air Defense said Nov. 12.
The air operations center would control air defense and missile assets, as part of preparations for an "emerging missile threat," Maj. Gen. Ibrahim Naser Al Alawi told an air chiefs conference organized by conference and consulting company Inegma, and held ahead of the Dubai Airshow's Nov. 13 opening.

The air operations center would be a "force multiplier," Al Alawi said.
A layered missile defense would offer "upper and lower" level protection, he said.
The UAE has orders for interceptors at the upper level, namely the Theater High Altitude Area Defense (THAAD) and Patriot advanced capability (PAC-3) missiles, respectively, from Lockheed Martin and Raytheon.
On the new air operations center, Lockheed Martin and ThalesRaytheonSystems are competing to win a contract, reported to be worth $1 billion, for delivering the integrated air and missile defense system, which is seen as a defense against Iranian threats.
A system that included interceptors against lower level threats and which might afford protection against saturation attacks appeared to open up opportunities for European missile maker MBDA.
"A versatility of interception is the right answer to multi-threat and saturation attacks," MBDA chief executive Antoine Bouvier said on the sidelines of the conference. "A segmentation of interception is not."
A multi-threat environment consists of attacks from aircraft, cruise missiles and ballistic missiles, with a possible mass launch of the latter weapon.
"Is an upper level only the right answer to a globalized threat?" Bouvier asked.
An upgraded version of MBDA's Aster missile, the NT1 due to be developed by 2015, could help counter the lower level threats and saturation missile attacks, he said.
Al Alawi's remarks appeared to confirm a move by the UAE toward a greater layered approach in its air and missile defense system, Bouvier said.
The UAE has reportedly cut a 2008 planned purchase to 96 THAAD missiles from 144, two AN/TPY-2 radars from four, and two batteries from three. That procurement also included six communications units and nine launchers. If all options had been exercised, the deal would have been worth $6.95 billion.
The UAE also signed up for the PAC-3 missile in a deal valued at over $1.8 billion over the life of the program.

Report Says UAE Will Receive 'Bunker Busters'

WASHINGTON - The United States has plans to provide thousands of advanced "bunker-busting" bombs to the United Arab Emirates as part of efforts to contain Iran, The Wall Street Journal reported Nov. 11.
The advanced munitions are designed to demolish bunkers, tunnels and other thickly reinforced targets, making them well-suited for a potential strike on Iran's underground nuclear facilities, the newspaper said.

The proposed package to the UAE - said to include up to 3,900 joint direct attack munitions (JDAMS), and other weapons - is to be formally presented to Congress "in the coming days," the Journal said.
In recent years, President Obama's administration has moved to shore up Arab Gulf countries with major arms deals, part of a policy of strengthening regional allies to ramp up pressure on Tehran.
The long-running dispute over Iran's nuclear program flared this week when the International Atomic Energy Agency said it had "credible" evidence that Iran was trying to build nuclear warheads for its medium-range missiles.
Iran denies it is seeking atomic weapons, insisting that its nuclear program is entirely peaceful.
The United States and Israel have in turn warned that all options are on the table for dealing with the issue, including military action.
U.S. Defense Secretary Leon Panetta on Nov. 10 warned of the risks from any military strike on Iran, saying it could have a "serious impact" on the region.
Panetta added that a military strike on suspected Iranian nuclear sites would only delay Tehran's nuclear program for about three years.
The United Nations has slapped four rounds of sanctions on Iran since 2006, and the United States and European Union have imposed their own restrictions.
Israel has signaled it may stage air strikes against Iran's nuclear sites, and Tehran has threatened to hit back against any attack or even the threat of military action.

Dubai Show May Include 1,000 Exhibitors................. JF-17 To Make Gulf Debut

PARIS - Pakistan is looking to steal the thunder with its JF-17 fighter jet, due to fly at the Dubai Airshow, opening Nov. 13.
The JF-17 Thunder, a single-engine, multirole combat aircraft, is co-developed by Pakistan Aeronautical Complex and China, where it is dubbed the FC-1 Fierce Dragon.
With a price tag of $20 million to $25 million per unit, the JF-17 is a low-cost plane poles away from Western-built fighters such as the F-15, F-16, F/A-18 and Rafale, also to be displayed.
Dubai will be the JF-17's fourth air show, after a static display at Farnborough, and flights at the Izmir show in Turkey and Zhuhai in China.
Pakistan also is showing off its Super Mushshak basic trainer, flown by the Saudi and Pakistan air forces, and its Karakoram-8 light trainer jet.
Alenia will field its M346 trainer jet, which previously won a UAE competition for a lead-in fighter trainer only to see the deal called off and a new tender set.
The U.S. is fielding the V-22 Osprey tilt-rotor aircraft alongside the conventional AH-64 Apache Longbow attack helicopter.
In the expanding market for spy planes, L-3 Communications will display its modified King Air 350ER turboprop, pitched at foreign clients as an intelligence, surveillance and recon asset.
At the large end of the spectrum, a Boeing 737 airborne early warning and control system plane from the Turkish Air Force will be at the show.
Dubai will host the 12th edition of the air show, which has booked up to 1,000 exhibitors from 50 countries, a 12 percent increase over 2009, the organizers said. More than 55,000 trade visitors are expected.

Despite Sales Drop, France 4th Largest Exporter

PARIS - French arms export orders fell in 2010, but the country held its ranking as the world's fourth-largest exporter, an annual report on foreign defense sales to parliament said Oct. 26.
Exports declined to 5.12 billion euros ($7.12 billion) in 2010 from 8.16 billion euros in the previous year, according to the report.

The foreign sales were secured in a "difficult climate and in an extremely volatile context," a Defense Ministry spokesman, Army Gen. Philippe Ponties, told journalists.
Exports are seen as vital to French defense industry and the government, as the domestic budget is expected to fall sharply as part of deficit reduction plans.
A major objective next year is to pursue at a New York conference an international treaty on arms sales, said Foreign Ministry spokesman Bernard Valero.
France held a 6 percent share of the world market based on an annual average of deliveries, behind the United States, which dominates with a 53.7 percent share, Britain with 12.5 percent, and Russia with 8.2 percent, the report said.
The world market was estimated at 60 billion to 70 billion euros in annual sales, Ponties said.
Major deals sealed last year included a sale of the A330 multirole tanker transport aircraft to Saudi Arabia, Cougar helicopters to Malaysia, and the upgrade of Alphajet trainer jets for Morocco.
This year, France sold two Mistral-class command and projection ships to Russia, and signed a long-awaited contract to modernize Mirage 2000 fighter jets for the Indian Air Force.
Winning a big contract for 60 Rafale fighter jets with the United Arab Emirates has proved elusive, as the UAE balked at an initial $10 billion price tag.
Defense Minister Gérard Longuet said Paris is in "final negotiations" with the UAE on the Rafales, but there has been no comment from UAE authorities.
Paris supports foreign arms sales, which are seen as a key foreign policy tool, helping France hold its place at the top in international affairs, Ponties said.
The sales are conducted under a strict export control regime, he said.
The foreign contracts also are seen as vital to maintaining the country's defense industry and technology base and supporting 135,000 directly employed in the domestic economy, he said.

U.S. To Deny Taiwan New F-16 Fighters

Offers AESA Radar in Upgrade for Older Jets
TAIPEI - Bowing to Chinese pressure, the U.S. will deny Taiwan's request for 66 new F-16C/D fighter aircraft, a Taiwan Ministry of National Defense (MND) official said.

An armed U.S.-built F-16 fighter takes off during a drill in April. A Taiwan Ministry of National Defense official says Taipei will not be able to purchase new F-16s and is “so disappointed” in the U.S. decision. (Sam Yeh / Agence France-Presse)

"We are so disappointed in the United States," he said.

A U.S. Department of Defense (DoD) delegation arrived here last week to deliver the news and offer instead a retrofit package for older F-16A/Bs that includes an active electronically scanned array (AESA) radar.
The visit coincided with the biennial Taipei Aerospace and Defense Technology Exhibition (TADTE), held here Aug. 11-14.
"The U.S. Pentagon is here explaining what is in the upgrade package," a U.S. defense industry source said at TADTE. "They are going to split the baby: no C/Ds, but the A/B upgrade is going forward."
Sources said an official announcement of the decision is expected by month's end.
But an official at the American Institute in Taiwan (AIT), the de facto U.S. Embassy, said "no decisions have been made," while DoD officials declined to comment on their delegation's mission.
The proposed upgrade package would make the 146 Taiwanese F-16A/Bs among the most capable variants of the aircraft, perhaps second only to the APG-80 AESA-equipped F-16E/Fs flown by the United Arab Emirates.
Originally requested by Taipei in 2009, the package would cost $4.2 billion, sources at TADTE said.
The new gear would include an AESA radar, likely either Northrop Grumman's Scalable Agile Beam Radar or the Raytheon Advanced Combat Radar, to replace the planes' current APG-66(V)3 radar.
Either one would be an improvement on the Northrop APG-68(V)9 mechanical radar once contemplated for Taiwan's upgrade package. The switch is meant to soften the blow of denying new planes to Taipei, a Lockheed Martin source said.
A decision between the two AESA candidates could foreshadow the U.S. Air Force's own choice as it prepares to upgrade its fleet of F-16s. The upgrade package will also improve the planes' Raytheon ALQ-184(V)7 electronic countermeasures pod by adding the capacity to intercept and save hostile radar transmissions, then use the same frequency to jam them.
However, ITT is offering the ALQ-211 Advanced Integrated Defensive Electronic Warfare Suite pod as an alternative.
ITT is also offering the BRU-57/A Smart Twin Store Carrier, which doubles the number of bombs an F-16 can carry, an ITT source said.
The package would also replace the AIM-9P/M Sidewinder air-to-air missile with the new AIM-9X; fit the planes to carry enhanced GBU-12 Paveway II laser-guided bombs; and add a digital radar warning receiver, helmet-mounted cueing system and center pedestal display.
The package will not include new engines to better handle the additional weight and electrical draw, though there could be an upgrade to bring the existing Pratt & Whitney F100-PW-220 to the PW-220E standard. The upgrade would swap out obsolete parts for newer ones, but wouldn't offer any additional performance.
Lockheed Martin will be working with Taiwan's state-run Aerospace Industrial Development Corp. (AIDC) to integrate the new gear on the jets.
"Changing a fighter's major sensor should not be taken lightly. It is more than electrical capacity. It is the integration of sensors, weapons, displays, etc., that make a fighter aircraft effective," Lockheed spokeswoman Laura Siebert said.

Consequences

Siebert said the failure to release F-16C/Ds will weaken Lockheed Martin's plans to extend the production line for the fighter.
"While Congress has been notified of Oman and Iraq's desire for F-16s, the Taiwan order for 66 aircraft is very important to the long-term viability of the F-16 production to include the U.S. Air Force, Lockheed Martin and the thousands of suppliers throughout the U.S.," she said.
More than a few TADTE attendees said the Obama administration might reverse the decision as the 2012 presidential election approaches and political pressure for new jobs builds.
A June report by the Perryman Group, a Texas-based economic and financial analysis firm, estimated that Taiwan's F-16C/D program would create more than 16,000 jobs and almost $768 million in U.S. federal tax revenue. Much of that tax revenue and new jobs would go to election battleground states: California, Connecticut, Florida, Maryland, Ohio, Texas and Utah.
But China holds about 8 percent of U.S. debt, the largest block in foreign hands.
As one TADTE attendee said, "Beijing's Kung Fu is better than Washington's."
The denial of the new jets will likely lead AIDC officials to ask the government to expand upgrade plans for Taiwan's 126 Indigenous Defense Fighters, of which 71 are currently slated for upgrades.
The company has also been pushing Taiwan's Air Force to allocate funds for full-rate production of the IDF C/D Goshawk, which features improved range and weapons payload.

Background

In July, the U.S. State Department indicated a final decision on the F-16 issue would be made by Oct. 1. Since 2006, the U.S. has repeatedly denied Taiwan's request for 66 F-16C/D Block 50/52s, a prospective sale estimated at more than $8 billion.
The planes would replace 60 F-5 Tigers and 60 Mirage 2000-5s due for retirement within five to 10 years.
China has called the sale a "red line." A recent editorial in the state-controlled People's Daily called for the use of a "financial weapon" against the U.S. if new F-16s were released.
The U.S. decision comes as a blow to the self-ruled island's effort to counter China's growing military, whose first aircraft carrier began sea trials last week, and therefore to its independence.
There are fears that losing Taiwan could spell the end of U.S. power projection in the region. Losing Taiwan would "change everything from the operational arch perspective to the posture of Japan and the U.S." in the region, said Raytheon's Asia president, Walter Doran, a retired admiral who once commanded the U.S. Pacific Fleet.
Staff writer Dave Majumdar in Washington contributed to this report.

Exchange Rate Behind UAE Rafale Balk: Dassault

PARIS - The price resistance from the United Arab Emirates on the Rafale fighter jet stems from an unfavorable euro-dollar exchange rate, but talks on the French aircraft continue, Dassault Aviation executive chairman Charles Edelstenne said July 28.

The UAE's discussion with Lockheed Martin about a potential purchase of additional F-16 fighters was "not a negative sign," Edelstenne told a press conference on the company's results for the first half of the year.

"Talks are going on," he said.

But with the euro at $1.40, the Rafale's sale price was boosted by the currency exchange rate, Edelstenne said. Dassault could not cut prices by 40 percent to offset the weaker dollar.

"I make Mirages, not miracles," he said.

The euro was trading at $1.43 in early afternoon, with the dollar under severe pressure from the U.S. government impasse on raising the debt-ceiling limit ahead of the Aug. 2 deadline.

Edelstenne refused to disclose the unit price of a Rafale, but he said an export purchase generally involves a political decision to pay a "price premium" that granted "independence of action." As the Rafale is built in France, reflecting a strategic decision on sovereignty, its costs are in euros, making it more expensive than an American fighter aircraft sold in dollars.

On the French government's July 20 decision to start negotiations with Dassault on a supply of the Heron TP medium-altitude long-endurance (MALE) UAV, Edelstenne said this meant sustaining a French design capability in military aircraft instead of paying for the "Messerschmitt design office" in EADS.

Edelstenne said in picking OHB over EADS, Germany made similar national selections in its space procurement.

Asked what the significance was in selecting Dassault as supplier of an interim MALE UAV, Edelstenne said the choice showed a determination to maintain a French national capability in building combat aircraft, as the next manned fighter jet would not enter service for another 30 to 40 years.

The negotiations would determine what sensors and communications payloads would go on the Israeli Aerospace Industries' UAV air vehicle, which is intended to provide an interim solution until the planned Anglo-French new generation MALE UAV enters service, expected in 2020.

IAI has agreed to disclose technical information on the Heron TP, which will be adapted to French requirements, including the ability to carry weapons, Edelstenne said.

The interim MALE UAV could have a service life of around 10 years and could overlap with the new Anglo-French air system, a company executive said.

On an asset swap under negotiation between Safran and Thales, Edelstenne said the airplane engine and equipment maker was holding up a deal by saying "no" to each new proposal from the electronics company. That forced Thales into a corner, he said.

"The valuation levels are a bit extraordinary," Edelstenne said.

Dassault signed an agreement with the government on an asset swap when it took its 26 percent stake in Thales, covering inertial navigation, onboard electricity generation and optronics, Edelstenne said.

Safran's sales in optronics are worth around 600 million euros, and if the business were put into Thales, that would make the electronics company second or third in the world market for electro-optics.

At the Paris Air Show in June, French President Nicolas Sarkozy said the government would impose a settlement if industry failed to reach a voluntary agreement.

Edelstenne said he was "very satisfied" with the Thales first-half results, which were released on July 27. The results displayed early effects of the Probasis restructuring plan and improved management of large programs and contract negotiations, he said.

Dassault reported a 35 percent fall in net profit to 129 million euros from 197 million euros a year ago, as sales dropped 34 percent to 1.32 billion euros from 1.99 billion euros.

The sales and profit slide came from lower deliveries of the Falcon business jet, with a delay in shipment of the Falcon 7X into the second half.

Orders declined to 95 million euros from 99 million euros.

On a production rate of one unit per month, Dassault has delivered six Rafale jets so far this year out of 180 total orders to date.

Privately, company executives expect the French government to stretch out future Rafale orders because of expected defense budget cuts, especially if export contracts are won.

Besides the UAE, Dassault hopes to sell the Rafale to India, Brazil and Switzerland. India is holding to its timetable to buy 126 medium-range combat aircraft, and the Swiss government has shown renewed interest in replacing its F-5 fighters.

UAE Eyes F-16 as Rafale Talks Falter

PARIS - The United Arab Emirates (UAE) is talking with Lockheed Martin about buying more F-16 fighter jets because France's offer of an advanced version of the Rafale is seen as too expensive, said a source familiar with the negotiations in the Arabian Gulf.

Discussions on the F-16 pile pressure on Dassault Aviation, builder of the Rafale, to cut prices and on the French government to increase funding for upgrades seen as vital to sealing an export deal for the twin-engine combat jet with the UAE, analysts said.

In the 1990s, the UAE bought 80 F-16E/F fighters under a $7.3 billion foreign military sales contract.

"The UAE is finding the Rafale offer to be too costly compared to the capabilities of aircraft and other technologies on the market," the source said. "The negotiations with France are still ongoing, and both sides are looking for a compromise."

The UAE has been seen as a potential first export buyer of the Rafale in a deal estimated last year at $10 billion. Meetings on the sale of the French fighter took place at the Paris Air Show, which ended June 26.

But price resistance has led UAE officials to open discussions with Lockheed to buy more F-16s with the latest "weaponry and targeting sensors," the source said.

Last year, UAE officials asked for technical information on Boeing's F/A-18E/F Super Hornet following a political chill at the highest levels between Abu Dhabi and Paris.

In talks with the French, the elements said to be stretching the UAE's planned budget are the co-development costs for a more powerful "special" version of the Rafale, plus maintenance and spare parts. The UAE wants its Rafales powered by Snecma M88 engines, whose 9 tons of thrust would provide 1.5 tons more than the version flown by the French Air Force.

Other improvements requested include a longer-range active electronically scanned array (AESA) radar and a more capable Spectra electronic warfare suite.

The upgrades previously have been estimated at 2 billion euros ($2.9 billion) by then-French Defense Minister Hervé Morin.

Officials with Dassault Aviation declined to comment. Shortly before the Paris Air Show, Dassault Chief Executive Charles Edelstenne said of the Rafale offer to the UAE, "the talks are advancing."

The gulf source said, "Lockheed Martin is offering a very attractive financial package."

A UAE sale might help Lockheed keep its F-16 assembly line open after India rejected the U.S. fighter in its Medium Multirole Combat Aircraft competition.

Lockheed officials were unable to comment by press time.

France badly needs export success on the Rafale, a showcase of military technological competence, as the national defense budget assumes foreign contracts to help pay for a steady rate of production.

Dassault has said it must build 11 Rafales per year to keep the production line running at an economical rate.

Large companies depending on the Rafale include Safran subsidiaries Sagem for the forward-looking infrared gear and Snecma for the jet engines, as well as Thales for the electronics and RBE2 AESA radar, and MBDA, which hopes to sell the Meteor long-range missile.

The UAE's interest in the F-16 has forced Dassault to reduce prices, said Loic Tribot La Spiere, chief executive of think tank Centre d'Etude et Prospective Stratégique. Dassault has little room to maneuver as it must sell the Rafale, needed to boost "other opportunities" in export markets, he said.

Dassault hopes to sell the Rafale to Brazil, India and Switzerland, among other countries.

"Faced with this development, Dassault could go far in concessions, and the Emirates know it," Tribot La Spiere said.

But the U.S. also has an urgent need to boost exports, given its dire domestic economic situation, Tribot La Spiere said. The gulf is seen as a region that helps sustain U.S. activity.

"In this context, it is a safe bet that buying the F-16 aircraft could be seen, or rather proposed, as underwriting a security insurance policy: 'You buy this product and we will ensure your security, even internally,'" he said.

Research fellow Hélène Masson of think tank Fondation pour la Récherche Stratégique said the UAE's talks with Lockheed are a "radical means to put pressure on Dassault's offer."

The move may raise France's financial burden to pay for the Rafale's development, particularly the M88 engine.

"The central problem is really the funding for the aircraft's new functions, notably the engine," Masson said. "It's a way to say to the aircraft maker, and above all, the French Defense Ministry, that they must contribute more significantly to the development of this new version of the M88 and so reduce the financial cost to the UAE. ... Yes, this is really a chess game."

Dassault refuses, as a policy, to use company money to fund military aircraft development, insisting the government client pay.

The French Air Force is understood to be content with the current engine's performance, so it appears Paris must decide whether to further fund upgrades to win the UAE sale. That comes as France seeks to cut its public deficit.

In the 1990s, the UAE bought 80 F-16E/F fighters, with distinctive conformal fuel tanks, under a $7.3 billion contract through the Pentagon's Foreign Military Sales program. A reported $3 billion of that amount went to co-develop the Block 60 Desert Falcon, widely viewed as the most capable version of the F-16 worldwide.

As co-developer, the UAE is co-owner of some of the sensitive military technology on the Block 60 version. As part of the deal, UAE personnel worked on the co-development program, and Lockheed trained Emirati nationals to service the Block 60 aircraft.

The 1990s also saw the UAE buy Dassault Mirage 2000-9s, which were more advanced than the 2000-5 flown by the French Air Force. Older Mirage fighters were also upgraded to the more capable variant.

The Mirage 2000-9 fleet still has a long life ahead, but the UAE could start taking delivery of the new F-16s in under five years while keeping its Mirages, the source said.

France has offered to buy back the Mirage 2000-9 fleet and resell it in export markets to encourage the Rafale sale to the UAE.

The UAE has bought the Black Shaheen cruise missile for the Mirage. The UAE also has the long-range strike missile Hakim, which was shown under the wing of a Rafale model displayed in February on missile maker MBDA's stand at the IDEX arms show in Abu Dhabi.

L-3 Displays Intel Plane, Eyes Export

LONDON - L-3 Communications has taken the wraps off a modified King Air 350 ER turboprop, which it says offers overseas customers an intelligence, surveillance and reconnaissance capability in advance of the U.S. Air Force's Project Liberty MC-12 aircraft but without many of the export clearance hang-ups associated with selling sophisticated spy platforms.
The U.S. company used last weekend's Royal International Air Tattoo (RIAT) at the Royal Air Force base at Fairford, England, to debut its Spydr aircraft to air force chiefs and others from around the world who gather for the annual event.

Bob Spivey, vice president of special programs for L-3's Mission Integration Division, said if necessary the Spydr aircraft can avoid some of the issues created by International Traffic in Arms Regulations (ITAR) by using technology sourced from outside the U.S.
Italy's Selex Galileo announced July 18 it was partnering with L-3 to offer its e-scan PicoSAR synthetic aperture radar as a payload option.
The L-3 executive said they were also talking to German electro-optical/infrared turret provider Zeiss.
Discussions with other potential suppliers were also underway, but Spivey declined to name them at this stage.
"It doesn't matter whether we put an [L-3] Wescam or Zeiss ball on Spydr. It's the same capability, just a different source of technology. Using technology like the PicoSAR makes it exportable and gets us out of some of the ITAR issues," Spivey said.
The privately funded Spydr development is pitched at domestic and export customers in defense and civil markets looking for a lightweight, affordable ISR capability, Spivey said.
Nations big and small are looking for ISR capabilities for maritime and land surveillance, civil duties with the police and other roles that won't break the bank.
King Air platform builder Hawker Beechcraft brought a special missions demonstrator of its own to the Paris Air Show last month, and Spivey reckons Boeing and Raytheon will also be among those competing in the expanding market sector.
The Spiral 1 development aircraft shown by L-3 at RIAT featured a fuselage-mounted Wescam electro-optical/infrared turret, a fuselage pod with a 100-pound payload, a tactical data link, satellite communications, a full signals intelligence system and other sensor options.
Spivey said the aircraft was returning to the U.S. after the tattoo to have Spiral 2 developments installed - principally a 2-foot extension of the aircraft's nose to allow a second sensor turret to be fitted - before heading for the Dubai Air Show in November.
Further technology developments are planned within the year when the aircraft goes into a planned Spiral 3 upgrade.
Potential customers in the Persian Gulf region include Saudi Arabia and the United Arab Emirates, according to L-3 Chief Executive Mike Strianese, speaking at the Paris Air Show in June.
Spivey said L-3 and others had already given the Saudis their pitch to supply ISR aircraft for possible border patrol duties. The executive said the machine, which is effectively a next-generation aircraft beyond Project Liberty, is also creating interest in South America, the Indian subcontinent, Southeast Asia, southern Africa , the U.K. and the U.S.
Britain already operates a Raytheon-supplied King Air special mission aircraft known as the Shadow.
Spivey said the Spydr is about three generations ahead of that aircraft, which was purchased by the British as an urgent operational requirement for campaigns in Afghanistan and Iraq.
Mark Johnson, L-3's vice president of next-generation ISR special programs, said the key design themes were flexibility and modularity to allow the company to tailor Spydr to meet the differing demands of customers.
L-3 has delivered dozens of special mission King Air-based twin turboprops, including MC-12 aircraft, to the U.S. Air Force but is not restricted to using the platform.
"While we love the airplane, we are not limited to using it," Spivey said. "The King Air just happens to be our test airframe."
The executive listed the C-27J, EADS CASA aircraft and the Dash-8 as other potential airframes.
"We are more talking about mission system than platforms," Spivey said. "[The King Air] just happens to be a real nice turbo aircraft which gets up to 35,000 feet. In the maritime surveillance business, you may need something like the Dash-8."
Spivey said the modular mission system also allowed a move down to smaller aircraft than the King Air, and the company was already doing some lighter-than-air and special operations-type work.