Russia, Algeria To Strike $4 Billion Arms Sale Deal
ALGIERS, January 26 -- Russia is set to sell $4 billion worth of arms to Algeria, in what would be its largest post-Soviet defense export deal.

"The work on the package of contracts for the delivery of a large part of Russian weapons to Algeria is practically complete, and they are likely to be signed in February," Interfax quoted an unnamed source in the defense industry.

The multibillion-dollar list of weapons includes 36 MiG-29SMT and 28 Su-30 fighter jets, eight divisions of S-300MPU2 Favorit air defense systems and a batch of T-90 battle tanks, the source said. Along with the four deals, Russia will sign a few more contracts for the upgrade of Soviet-made arms already in Algeria's possession, the source said.

The news was confirmed by an independent defense source, who said the package of contracts had already been ratified and was expected to be signed during President Vladimir Putin's visit to the North African country late next month or in March.

MiG, Irkut, which makes Sukhoi fighter jets, and the Almaz-Antei air defense concern refused to comment, as did Rosoboronexport, the state-owned arms selling agency.

The weapons will be paid for in a "complicated scheme involving striking off part of Algeria's Soviet debt," the source told Interfax, without specifying the period over which the arms would be delivered

In addition to the upcoming contracts, Algeria may buy up to 50 Yak-130 combat trainer planes and about 30 Tunguska-M1 air defense systems, the source said.

"If signed, it will be the largest arms deal for post-Soviet Russia; it will be grandiose," said Konstantin Makiyenko, deputy head of the Center for Analysis of Strategies and Technologies, a Moscow-based defense think tank.

The last deal of similar magnitude was signed with India in 2000 for licensed production of 140 Su-30MKIs and was worth $3.3 billion, Makiyenko said.

For the last few years, Russia, the world's largest arms exporter after the United States, has been selling in excess of $5 billion worth of arms annually. The deal with Algeria is very timely as Russia's prime clients -- China and India -- are increasingly looking to diversify their arms suppliers and their markets are gradually becoming saturated, analysts said.

"Algeria was Russia's traditional arms client in Soviet times, but after the breakup it switched to Ukraine and Belarus mainly, buying Su-27s and MiG-29s. This contract will be Russia's triumphant return to North Africa," said Ruslan Pukhov, editor of Moscow Defense Brief magazine.

"In the coming years, Algeria will account for 20 percent of Russian's arms exports, while China and India will plummet from 70 percent to 50 percent," Pukhov said.