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Aerospace & Defense

Japan pushes defense equipment exports with corporate expertise

India, Indonesia, Vietnam and Malaysia targeted for market research

A P-3C of the Japan Maritime Self-Defense Force. Japan anticipates demand for patrol planes and other equipment in nations that have territorial disputes with China. (Photo by Kei Higuchi)

TOKYO -- The Japanese government will work with the private sector to promote sales of defense equipment to India, Indonesia, Vietnam and Malaysia, helping to provide market research and other expertise in a sector long barred from exports.

Japan has struck only four deals involving components since the 2014 revision of a rule that had prohibited the export of weapons. The change cleared the path to exports under certain conditions, such as if the equipment would contribute to peace, as a way to support the domestic defense industry.

With no deliveries of finished equipment over the past six years, the government attributes the slow activity to inexperience finding sales channels due to the long-standing export ban. It will work with trading houses and other companies with operations abroad.

The Acquisition, Technology & Logistics Agency under the Defense Ministry will choose a company to conduct market research as early as next month. A proposal will be crafted based on the budgets and needs of each country, with the goal of identifying promising items for export. Based on the proposal, the government will conduct negotiations with the four nations starting next spring.

There are hopes within the government for export of rescue helicopters and communications equipment for use in disaster management. The four countries frequently suffer from natural disasters such as earthquakes and tsunamis, just as Japan does.

Japan also aims to pitch defense equipment to countries grappling with China's buildup of military forces. It expects interest in land-based radar and patrol planes among countries that have territorial disputes with Beijing in the South China Sea, such as Vietnam and Malaysia.

Some companies are wary of becoming deeply involved with the government in the defense business, considering the potential perception of being an arms dealer. But the government expects companies to cooperate in this case, given their mostly indirect role such as market research and the fact that boosting exports helps prop up Japan's defense industry.

To export defense equipment, Japan needs to first sign an agreement with the purchasing nation. Such treaties went into force with India in March 2016 and with Malaysia in April 2018. Negotiations are underway with Indonesia and Vietnam, and Japan hopes to finalize agreements quickly while it conducts market research.

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