Plans to produce helicopters in India and China indicate a new direction for Russian Helicopters as the state-owned manufacturer makes bigger strides to take on its Western rivals.

The consortium, 100% owned by Oboronprom, Russia's aerospace holding company, wants to open an assembly line for helicopters in India. The new facility would be a critical component in the push to win the Indian armed forces' requirement for 197 light multirole helicopters—a program in which the coaxial Kamov Ka-226 is competing. It would also provide a useful advantage as India's civil helicopter market begins to take shape.

Russian Helicopters signed an agreement on Dec. 26 with Elcom Systems Private Ltd., part of the Indian investment conglomerate SUN Group, to set up a new facility to build models from the Mi- and Ka- families of helicopters. The move is significant because until now Russian Helicopters has not built a single helicopter outside the Commonwealth of Independent States (CIS), instead operating from its facilities inside the Russian Federation.

But now, Russian Helicopters, under the leadership of CEO Dimitry Petrov, is taking a view similar to that of its Western rivals, Eurocopter and AgustaWestland, both of which have set up final assembly lines overseas to establish a greater foothold in the region. Russian Helicopters currently claims a 14% share of the military and civil market, but is keen to boost that figure as it introduces new products.

While it is recognized that ambitious fighter programs may deliver ground-breaking technologies, the local manufacture of helicopters, particularly for the commercial and parapublic market, can deliver useful skills and knowledge. The increased use of rotary-wing aircraft as air ambulances and for law enforcement also indicates improvements in a population's quality of life.

Russian Helicopters has so far provided only scant details on the India project. But it is likely to start with the production of components for the Ka-226 light helicopter before expanding to build and complete final assembly of the aircraft, as well as engage in ground and flight testing of the type and other models in the Russian Helicopters stable. The move comes following Russian President Vladimir's Putin's pledge to strengthen historically strong ties between his country and India, despite the fact that several significant defense programs have not all gone Moscow's way.

The two countries did, however, sign off on a significant contract to purchase new Sukhoi fighters and Mi-17 helicopters. Similar plans for helicopter production have also been discussed for China, another strong Russian Helicopters customer, which recently ordered 52 Ulan-Ude-built Mi-171s. In conjunction with Chinese manufacturer Avicopter, joint production of the Kamov Ka-32 model is being explored and work is pushing ahead on the development of a new heavy-lift helicopter—smaller than the 56-ton Mi-26 with a maximum takeoff weight of around 30-40 tons. It has been suggested that production of Ka-32s in China could begin in two years. A similar scheme discussed for Jordan in conjunction with Oboronprom back in 2006, also to build the Ka-226, has fallen by the wayside.

Russian Helicopters believes that orders of around 50-70 medium helicopters would provide a promising business case for local assembly, given reduced labor costs, and would open the possibility of new supply options for components.

Russian Helicopters' plans mirror those adopted by its European rivals. Indeed, the company already works with AgustaWestland to produce the AW139 medium helicopter in Russia, through the Helivert joint venture. The two companies are also working on a light helicopter program. In Brazil, companies such as Aernnova do Brasil hope that successful production of tail booms for Eurocopter subsidiary Helibras could ultimately result in securing work now done on the EC725 and EC225 heavy helicopter production line in France. Production in Brazil could yield savings of between 10-20%, according to Eurocopter.

Aernnova started building the tail booms in mid-2012 to feed Helibras' newly opened production line for the EC725 helicopter, of which 50 will be built for the Brazilian armed forces. Under Brazilian law, the new aircraft must feature 50% Brazilian content. As a result, Helibras has contracted work on key structures and other major components to local companies. With the production line, Helibras also has the capability to build the civil version of the helicopter, the EC225, allowing Helibras to serve the burgeoning Brazilian oil and gas market. The skills developed through the program will also ultimately allow Helibras to play a role in the development of future products in the Eurocopter stable.

Eurocopter believes this model can work elsewhere, and is offering it to the Polish government as Warsaw seeks options to replace its aging fleet of Mi-8, Mi-14 and Mi-17 transport helicopters. AgustaWestland and Sikorsky already have established mechanisms to offer helicopters to Poland through the purchase of Polish manufacturers PZL-Swidnik and PZL-Mielec.