July 14: The Burmese military’s appetite for weapons appears insatiable. William Ashton details the regime’s recent purchases.

Burma’s ruling State Peace and Development Council, or SPDC, has been at pains over recent months to tell the international community that it is devoting a considerable effort to implementing a new “road map” to multi-party democracy and introducing measures for a more open economy.

The military government has also claimed major advances in promoting education and public health, and in developing the country’s civil
infrastructure.

The Rangoon regime can certainly point to an increase in diplomatic activity, and show visitors to Burma many new roads, buildings and dams. However, the SPDC?s statements continue to ignore the fact that, for the past 15 years, a large proportion of its central budget - probably between
35 and 45 per cent each year - has been allocated to the armed forces, or Tatmadaw.

This does not include significant allocations to the defense sector from off-budget sources and unofficial payments that never appear in the national accounts. Also, while an increasing proportion of Burma’s annual defense expenditure is now used to pay for recurring personnel and maintenance costs, a high percentage is still devoted to the acquisition of new arms and equipment from abroad.

Continued Military Expansion

When the armed forces took back direct political power in 1988, they launched an ambitious defense expansion and modernization program. Since then, the regime has consistently spent a greater proportion of central
government outlays on defense than any other country in the Asia-Pacific region.

The Burmese armed forces have doubled in size, making them the second largest in Southeast Asia and, by some calculations, the 15th largest in the world. New command and control structures have been put in place, and capabilities in key support areas like intelligence, communications and logistics have been substantially upgraded.

The country’s military infrastructure has also been improved. In addition, the Burma Army has acquired a wide range of tracked and wheeled armor, towed and self-propelled artillery, air defense weapons, transport, small arms and communications equipment. The air force has taken delivery of more than 150 helicopters, fighters, ground attack, transport and training aircraft. The Burma Navy too has expanded dramatically, with new corvettes, missile patrol boats, offshore patrol vessels and riverine craft.

Given its enormous expansion since 1988, the massive influx of arms and equipment since then, and the difficulties of keeping its current inventory fully operational, it might be expected that the Tatmadaw’s acquisition programs would now be slowing down. Yet, over the past 18 months, there has been clear evidence that the Rangoon regime continues to give its highest priority to the development of Burma’s military capabilities.

While some of the SPDC’s more ambitious projects, such as the planned acquisition of strategic weapon systems, have reportedly been shelved for the time being, other major contracts have gone ahead. China remains Burma’s principal source of military technology but, despite an arms
embargo imposed by its traditional suppliers, the regime has managed to find a number of new vendors.

Arms Deliveries

A survey of arms deals with Burma over the past 18 months has revealed the following:

China

Rangoon is locked into a continuing close logistical relationship with Beijing, due to the need to maintain all the arms and military equipment purchased from China, at an estimated cost of billions of dollars, since 1988. However, the SPDC is interested in acquiring even more arms, and new
weapons and consignments of materiel continue to be delivered.

There have been reports of 200 heavy-duty trucks crossing the China-Burma border, and of shipments of unspecified “air force weapons”, multiple rocket launchers and possibly artillery. There were also reports in March 2004 that the
Burma Army was negotiating yet another arms deal with China, this time to buy obsolescent weapons being phased out by the People’s Liberation Army. In addition, there have long been rumors that Burma has been negotiating with China for the purchase of combat helicopters, minesweepers, anti-ship missiles and sea mines.

North Korea

Rangoon’s developing relationship with Pyongyang has gone well beyond the small arms ammunition purchased in 1990, and the sixteen 130mm artillery pieces acquired by the SPDC in 1998. For example, in 2003 a team of North Korean technicians was sent to Rangoon to install surface-to-surface
missiles on some new Burma Navy vessels. In addition, discussions have taken place between Rangoon and Pyongyang over the purchase of a small submarine, and possibly even a number of SCUD short-range ballistic
missiles.

Late last year there were even suggestions that North Korea was assisting Burma with the construction of a nuclear reactor, raising the specter of the Rangoon regime one day acquiring a nuclear weapon.

India

As part of a renewed effort to get closer to Burma, India has provided the Tatmadaw with a range of weapons, ammunition and equipment. In May 2003 the Indian Defense Ministry confirmed that it had sold the Tatmadaw eighty 75mm howitzers (or “mountain guns”). Also, India has reportedly sold mortar and artillery ammunition to Rangoon, and advanced communications equipment.

A Burmese military delegation visiting India in early 2004 said that the Tatmadaw welcomed further arms deals. The Indian Defense Minister has stated that New Delhi is keen to sell Burma naval vessels. A demonstration by Indian combat aircraft in Burma this year prompted speculation about future sales to the Burma Air Force.

Ukraine

The Russian language press stated in late 2002 that the Ukraine had contracted to provide Burma with some 36D6 radar systems. In mid-2003 it was reported that the Ukraine had sold the Tatmadaw 50 T-72 main battle tanks. In February 2004, a Ukrainian-flagged ship made a secret delivery to Rangoon, probably of air defense weapons. Also, in May 2003, one of the Ukraine’s leading arms exporters signed a contract with Burma worth US $500 million, to provide the Rangoon regime with components for 1,000
BTR-3U light armored personnel carriers. Over the next ten years these vehicles will be supplied in parts, and assembled in a new, purpose-built factory in Burma. More arms deals between Rangoon and Kiev are likely.

Serbia

In December 2003, Serbian language sources claimed that Rangoon had contracted with Belgrade to buy a number of “Nora” self-propelled howitzers. The cost of these weapons, which are marketed by Jugoimport-SDPR, is unknown. In addition, in March 2004 about 30 Serbian engineers arrived in Burma to repair and upgrade the Burma Air Force’s 12
Soko G-4 jets, which were purchased from the Republic of Yugoslavia in the 1990s. These aircraft have been grounded for several years, due largely to a lack of spare parts.

Russia

In late 2002 the SPDC purchased eight MiG-29B-12 air superiority combat aircraft and two dual-seat MiG-29UB trainers from Russia, at a reported cost of about US $130 million. All these aircraft were delivered to Burma by the end of 2003. In addition, in July 2002 Rangoon signed a contract
with the Russian Ministry of Atomic Energy (Minatom) for the construction of a nuclear reactor in Burma. While the project has encountered major problems, probably due to its cost, it may still go ahead. It is likely that the shipments of Russian military equipment detected in southern Burma in April 2003, which were thought to be components for the reactor, were in fact deliveries of a new communications system.

Slovakia

According to a news report dated October 2003, the Unipex Company of Slovakia is currently being investigated for taking part in the illegal export to Burma of machines for the manufacture of “artillery grenades” (possibly rocket propelled grenades).

It is likely that other contracts have been signed but not yet been made public. The frequent visits to Rangoon of North Korean and Ukrainian cargo vessels over the past 18 months, and the measures taken to hide the nature of their cargoes, strongly suggests that other deliveries of arms and
equipment have occurred. Several eastern European countries are keen to sell arms to Burma. Also, countries like Singapore, Pakistan and Israel maintain close links with Rangoon. All have weapon systems that are on the Tatmadaw’s wish list. In the past, these factors have often led to substantial sales of weapons, military equipment and dual use goods to Burma, and related training contracts.

Paying The Bill

In considering the financial implications of these sales, several factors need to be borne in mind. Not only does the regime need to cover the initial purchase price of these arms, but it faces the continuing costs of keeping them serviceable, providing facilities to house them, buying spare parts to maintain them and training people to repair and use them.

The latter often includes sending selected military personnel overseas for specialized training, and in a few cases supporting foreign experts resident in country. Some of these costs can be paid in local currency, but they still constitute a heavy drain on Burma’s precious foreign
exchange reserves. The regime is still able to earn hard currency through the export of gas, gems, timber, agricultural produce and other natural resources, but its economy is facing major problems. These have not been
helped by the new sanctions imposed by the US in June 2003, after a government mob violently attacked democratic opposition leader Aung San Suu Kyi.

In the past, some of these costs have been met through trade deals, under which Burma has paid for part of its contracts with primary goods like rice and teak. North Korea and Russia, for example, have accepted such commodities in part payment for arms and military equipment. Even the
Russian nuclear reactor could be paid for in part through barter arrangements. Also, for strategic and other reasons, some arms suppliers have been very generous in their terms. For example, China has repeatedly offered the Rangoon regime special “friendship prices” for arms, and overlooked deadlines for the repayment of loans. The Ukrainian firm
selling Burma APCs has probably provided vendor financing of some kind.

Even so, given the regime’s current debts, its continuing need for foreign logistical support, and its latest acquisitions, the investment required now and in the future will be huge for a country like Burma. These costs must inevitably be carried at the expense of other sectors of the government that are desperate for scarce resources.

William Ashton writes regularly about security issues in Asia.