A couple of weeks ago, we saw Varyag move from its old location to dry dock for some works. From all of the stuff that we’ve seen on the flight deck of Varyag in the recent photo, it’s clear that they are going to do a lot of work on it. This move was supposed to happen sometimes last year, but China did not want to scare the world with such a show a military ambition (especially when it was so close to the Olympics). It has for the past year prepared the rest of the world for a Chinese aircraft carrier by telling various countries around the world that China should be allowed one. My personal opinion is that China should just tell the rest of the world “I have the 3rd largest economy, I’m one of the Permanent 5 on UNSC, I have the largest population and I need a couple of carriers”. Instead, it’s doing the same thing that it did before sending fleet over to Somalia. Does anyone think that countries that felt threatening about Chinese naval power would feel any safer after listening to the way it explained itself?

Having mentioned that, the next part that I want to address is Ukraine’s role in Varyag. For many years, I’ve read people talking about how Ukraine got duped and tricked by China in the entire Varyag affair. I really think that’s just nonsense. I think Ukraine knew exactly what was going to happen to Varyag when it was purchased. That is why it hasn’t lodged any kind of complaints to China about this ship. Ukraine did want to receive heat from other countries for its role in China’s aircraft carrier program, so it went along with the entire floating casino story line. Ukraine for the past few years have been in a competition with Russia for military exports to the Chinese market. In the past year, Ukraine just signed a new defense cooperation agreement with China, so the military cooperation between the two countries is growing. It is beating Russia in many contracts by offering lower rates and better services. It’s kind of interesting to compare China’s dealings with Ukraine and India’s dealings with Russia. Both Russia and Ukraine had a rotting aircraft carrier that it had no real use for (Varyag and Admiral Gorshkov). Russia offered Admiral Gorshkov to India for free, but also forced India to buy its naval fighters and the continuing escalation cost of refitting the ship. Ukraine offered Varyag to China for $20 million, let China do its own refurbishing, is assisting China in its naval fighter development and also offering to help China train its pilots. You may be trying to figure out what I’m talking about, so I will go through with my theory. We know that Ukraine does not have the capability to produce naval fighters that it can sell to China for carrier. So, it is helping China and snubbing the Russians by selling China its T-10K prototype, an earlier prototype for Su-33. We know from Kanwa interviews that Ukraine is very much involved with China’s flanker fleet through the sales of missiles like R-27, helping PLAAF with maintenance and overhaul of flankers. If China is working on its own naval flanker, then Ukraine is likely standing to gain through the sales of certain naval fighter specific subsystems, missiles and servicing agreements (although whether this actually happens remains to be seen). Ukraine also has Nikita, which is the only aircraft carrier training center from the Soviet times. As we know, the Russians are not really spending that much time training and operating its su-33 fleet and is also looking to build its own aircraft carrier training center. As it currently stands, the Ukrainians are not getting a lot of business at Nikita. On the other hand, PLAN is really looking to actively train enough pilots for 2 air wings. The latest news from Russia indicates that Ukraine has signed an agreement with China to lease this facility for its naval aviation school. I can imagine Ukraine will also be selling other naval training software/tools to China. There are also other areas that I think Ukraine can profit from cooperating with China on aircraft carrier. It can possibly sell the propulsion system for Varyag or future aircraft carrier (latest Chinese DDGs already use Zorya gas turbines). And since China is building escort ships for the carrier fleet, these ships will also need to purchase gas turbines from Ukraine. Aside from propulsion system, China could also be interested in other carrier subsystems that Ukraine produced for aircraft carriers in Soviet time. And finally, Ukraine is also supplying engines for the L-15 trainer and possibly supplying engines for China’s new 10 ton helicopter. These two may become part of the air wing on future aircraft carriers, so Ukraine is potentially expanding markets for its aerospace engine factories. I think that this is a very beneficial relationship overall. Ukraine has certain aircraft carrier related technology and experience that it would otherwise have no customers for. China has the need for these technology and experience, but do not have access to many other sellers (actually, Russia is its only other choice). So generally, I think this deal is a win-win for both side, whereas the Admiral Gorshkov fiasco has really only benefited the Russians. The Russians managed to get rid of their rotting hunk of steel, received a lot of work for a shipyard that is not getting much business elsewhere, found a market for its Mig-29K fighters + Ka-31 helicopters and got paid by India to rebuild its carrier suppliers base/work force. The last two point are very important since these suppliers and fighters/heicopters will be needed for future aircraft carriers for Russian Navy and even India’s indigenous carriers. The Ukrainians really needed to sell their rotting hunk of steel, didn’t have the naval shipbuilding ambitions of Russia and also needed to sell whatever carrier technology/service that it still has before their shelf life runs its course. Therefore, it didn’t mind that China is doing its own refurbishing/upgrades and assisting China in naval aviation. China probably benefited even more, because it got all the technology and carrier building experience it needed without having to deal with or rely on the Russians. Of course,

As an aside, the entire IL-76 saga was similar to this. China and Russia got into a huge disagreement over the pricing and Russia claimed that the plant in Tashkent is not able to produce the IL-76s needed. After Uzbekistan realized that Russia is taking away all remaining business by building a plant in Russia, it decided to negotiate directly with China to try to sell the blueprints, the technology and the assembly line to China. As it turned out, due to certain special interest groups, China overplayed its hand in the entire matter (maybe due to confidence from Varyag deal) and blew the negotiation with Uzbekistan. Now, it is forced to renegotiate with the Russians for the upgraded IL-476. I thought it’s interesting how you can use the competition between Russia and other former Soviet Republics to get the best deal. Obviously, a lot of what I said here are my opinion, but I feel a lot of it is pretty close to the truth.