Kazakhstan’s defense industry gathers pace despite crisis – President of Kazakhstan Engineering National Company M. Mukhamediyarov


Emir Gulam

Kazakhstan's defense industry gathers pace despite crisis - President of Kazakhstan Engineering National Company M. MukhamediyarovKazakhstan’s defense industry, on one hand, is something like a “dark horse” for ordinary people. On the other hand its ventures play a significant role in the strategy of the country’s industrial-innovative development. President of Kazakhstan Engineering National Company Marat Mukhamediyarov tells about the problems and major directions of the sector’s development in an interview to Kazinform.

Kazakhstan Engineering is a renowned holding which unites the ventures of defense industry. What is the share of non-defense products in your ventures? What is their potential in manufacturing goods and equipment for other sectors?

Our company unites machine-building ventures, 15 out of which are the “flagships” of domestic engineering. The ventures are specializing in producing the goods and services for oil and gas, railway, energy complexes, agro-industrial sector as well as in production, implementation and repair of weapons and military equipment.

Today, despite the crisis, Kazakhstan Engineering NC gathers pace.

As for non-defense products, our company carries out an analysis of the population’s needs. For instance, at present we work on development of digital telecommunication infrastructure in rural areas. Implementation of digital terrestrial television is one of the main directions in this field. We also plan to establish an experimental area of digital television in North Kazakhstan oblast which is expected to cover 2 municipalities.

Our experts also made a huge contribution to solution of drinking water problem in rural areas. Over 300 Tazasu water purification stations are functioning now in western and southern regions of the republic as well as in the units of the Emergencies Ministry and Frontier Service of the Kazakh National Security Committee. These installations not conceding on quality to the foreign analogues were produced at Omega plant of Uralsk.

What is the role of Kazakhstan Engineering NC in implementation of the country’s Forced Industrialization Program?

Our ventures constantly work on renewing and development of technological base. They are ready to join the state industrialization program, in particular, in development of oil and gas deposits, implementation of the projects on expansion and reconstruction of state district power stations, Western Europe-Western China transit corridor and other breakthrough projects as a supplier of goods, services and works.

Did you change your export strategy taking into consideration establishment of the Customs Union, new markets and stronger competition?

With establishment of the Customs Union we expect growth in trade turnover with Russia and Belarus in military and dual-use goods, usage of up-to-date technologies of these countries while manufacturing Kazakhstani arms and military equipment. Certainly, to compete today with them is more difficult. Therefore we chose the course towards modernization of enterprises and renovation of equipment park.  Alongside, in our interaction with foreign partners we lay emphasis on transfer of new technologies, due to which the share of domestic content rises.

We are negotiating at present with Thales Communications France on bilateral cooperation and further development of Thales Kazakhstan Engineering joint venture for establishment of radio station productions in Kazakhstan. Thales which is the leading venture of Europe in production of electronic systems of communication obliges to transfer technologies of production of privacy communication systems for Kazakhstan’s force structures.

We also talked with Italian companies on release of products for oil and gas industry at the Kazakhstani plants. A memorandum on establishment of the Kazakh-Italian enterprise with DRILLMEC S.p.A. was signed.

We had a dialogue with the representatives of Germany’s Robert Bosch and Intelligent Network Company. Currently we are drafting the contracts on supply and assembly of security systems on the ground of Almaty-based KazEngElectronics Company. Soon we expect to see the first results of a pilot project which we would like to demonstrate at the forthcoming KADEX-2010 exhibition.

The products we are going to release together with foreign partners will be exported both to the CU and foreign countries. In one word the ventures of Kazakhstan Engineering destroyed the myths and stereotypes on inability of the domestic producers. For example, the machine-building plants of Semipalatinsk assemble track-laying vehicles, amphibian tractors and off-road vehicles. Russia is their main customer.

What products do you supply to the Armed Forces of Kazakhstan?

At the beginning of May Zenit Plant of Uralsk launched the first Bars warship. This crucial for the country event proves that Kazakhstan has good potential and capacities for production of modern and secure military boats and ships.

Over the last seven years a part of the military and dual-use products manufactured by our daughter companies have been regularly sent for the Armed Forces equipping. These are the up-to-date ships, coastal repair shops, first experimental complexes of multiple launch systems. Besides, we provide services connected with repair and partial modernization of weapons and military equipment.

In accordance with 2010-2015 concept of development of the country’s defense industry and within expansion of our company we plan to establish service centers on modernization and replacement of all technological lines with more modern equipment.

In further we will need new enterprises and productions for manufacturing artillery systems for different purposes, armored recovery vehicles based on T-72 tank, Igla-S autonomous portable system based on the BRDM chassis,  universal launch modules of self-defense based on Igla-S and Shturm-Ataka  rockets, means of communication, e-intelligence etc.

Today we plan to build a plant and develop technologies on manufacture of bullets, automated means of management of troops, boats, ships and warships and dual-use ships, ship repair facilities for technical service of the boats and ships on the Caspian Sea, firefighting and emergency equipment, manufacture of radars and modernization of the existing systems. In 2010 together with repair and construction of ships for frontier services we plan to lay a foundation of the first domestic ship for Kazakhstani navy.

You are an official sponsor of the first international exhibition of armament, military vehicles and equipment KADEX-2010. What result do you expect from this event?

11 subsidiary enterprises will represent Kazakhstan Engineering NC at the KADEX-2010 exhibition scheduled for May 26-29 in Astana. They will demonstrate various products there – rocket missile defense systems, military-navy products, services on their modernizations etc.  Over 200 companies from 18 countries have already confirmed their participation in the event. We intend to meet with the representatives of defense industry of the CIS and non-CIS countries, discuss and define the major fields of mutually beneficial cooperation and conclude short-term and long-term agreements.