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Leonardo Inaugurates Office in Islamabad

On 11 April 2019, the Italian defence giant Leonardo inaugurated its new office in Islamabad, Pakistan in the presence of corporate and public officials, including Leonardo International CEO Dr. Lorenzo Mariani, Leonardo CCO Dr. Marco Buratti, and the Italian Ambassador to Pakistan Stefano Pontecorvo.

The office will headquarter Leonardo’s operations in Pakistan. In fact, it is basically a branch of the vendor – i.e., Leonardo Pakistan – with its own leadership and chairman, Dr. Maurizio Facchin.

Following the inauguration, Leonardo Pakistan met with Pakistan’s Chief of Naval Staff (CNS), Adm. Zafar Mahmood Abbasi, the Chief of Air Staff (CAS) Air Chief Marshal Mujahid Anwar Khan, and the Minister of Defence Production (MoDP) Zubaida Jalal Khan.

The inauguration makes Leonardo among a handful of Western defence suppliers to maintain a direct and official presence in Pakistan as a means for managing its activities and promoting its products. Others will typically work through a domestic agent or through a regional office in the Middle East.

The Leonardo Pakistan office is a part of a larger push by the Italian defence giant to boost its global sales efforts – the company reportedly planned to open 30 new offices by 2020-2022.

Overall, the office signifies that Leonardo sees Pakistan as a viable market and, in another sense, is willing to accept the consequences of setting-up an official presence in Pakistan.

The latter could result in losing the Indian market, especially as many other Western suppliers will temper their dealings with Pakistan to maintain a cordial relationship with India. However, it should be noted that Leonardo has been under an Indian Ministry of Defence (MoD) blacklist since 2016.

In Pakistan, Leonardo is engaging on a range of fronts, including:

Though substantive, it appears that Leonardo is intending to expand its activities in Pakistan to a number of big-ticket requirements and opportunities. However, Pakistan’s precarious fiscal capacity will dampen the overall scope. It is unlikely ever requirement will materialize, but the fruition of one could be enough to warrant a success of Leonardo’s (albeit modest) investment in Pakistan thus far.

Pakistan Air Force


Lead-in Fighter Trainer

In the lead-up to the 2018 International Defence Exhibition and Seminar (IDEAS), the PAF revealed through a trusted journalist that it was seeking a lead-in fighter-trainer (LIFT).

This was a full pivot from its earlier stance of not requiring a dedicated LIFT (see here for Quwa’s interview with retired PAF Air Commodore Kaiser Tufail on the issue). In any case, it appears that the new LIFT would ultimately equip the newly-raised ‘Shooter Squadron’ at PAF M.M. Alam.

Leonardo is proposing its M-346 for the PAF LIFT requirement. The M-346 is available in three variants: a trainer – i.e., the Master – that is equipped to acclimate pilots to current and next-generation fighters; a “Red Air” variant for dissimilar air combat training (DACT); and an armed M-346FA light fighter variant.

The basic idea of the M-346 is that the receiving air force could get one platform to support two marquee training roles: fighter-conversion and aggressor training. In most cases, the benefit of the M-346 is that it frees costlier frontline fighters from those roles. It also offers a comparatively low-cost attack option.

To the PAF, the M-346 could mean withdrawing the F-16 and Mirage III/5 from the Combat Commanders School (CCS). Both fighters are in limited supply, yet are instrumental to the PAF’s offensive element – so removing them from CCS helps preserve hours and removes one peacetime risk-factor, i.e., attrition as a result of training. In addition, the M-346 could also supplant the F-7P/PG and FT-7P/PG.

However, the ‘benefit’ to the PAF works in the reverse. It should start with replacing the F-16 and Mirage in CCS with a ‘Red Air’ M-346 with a highly electronics suite, including an AESA radar, electronic warfare (EW) suite, helmet-mounted display and sight (HMD/S), and air-to-air munitions.

In effect, the M-346 could stand-in as an aggressor representation of Western fighters. But in addition to serving with CCS, the PAF could scale the overhead to cover LIFT and, potentially, close air support (CAS) for asymmetrical operations, such as counterinsurgency (COIN).

However, with a unit price of $36 m with a support/maintenance and training package (Flight Global), the M-346’s cost is not trivial. A hypothetical order of 24 aircraft would cost almost $1 billion US. Though the M-346 could be an intriguing solution for several problems, it would also be a luxury.

Ground-Based Radars

If the PAF could spend $1 billion US, it would likely be on improving its ground-based air defence capability with an AESA-based radar to supplant its Mobile Pulse-Doppler Radars (MPDR).

The MPDRs provide the PAF with early warning detection at low-altitudes and short-ranges. However, being of older technology, the MPDR is not as resistant to EW as an AESA-based system. Leonardo showed its Kronos Land radar at IDEAS 2018; the Kronos Land is a C-band AESA radar with a range of 250 km. The end-user can also integrate the Kronos Land with a surface-to-air missile (SAM) system.

Where the M-346 is an intriguing luxury, supplanting the MPDR is a priority as the antiquated radar could be a vulnerability, especially as India acquires improved EW capabilities.


Equipping the JF-17 Thunder

Leonardo is offering its Grifo-E AESA radar for use on the JF-17 Block-III. The Grifo-E is billed as a ‘low-cost’ radar with new gallium nitride (GaN) transceiver modules (TRM). According to Leonardo, the Grifo-E has a lock-up detection range of ‘fighter-sized targets’ of 45 nm to 85 nm – i.e., 83 km to 157 km.

The specific capabilities aside, a major constraint of the Grifo-E is the fact that Pakistan cannot use Chinese radar-guided air-to-air missiles (AAM) and anti-ship missiles (AShM). The short of the problem is that both sides are apparently unwilling to share their respective source-codes (Air Forces Monthly, April 2017).

However, if Pakistan succeeds in developing its own radar-guided munitions (or in acquiring them from a new source, such as Turkey), then Leonardo radars could again factor into the PAF’s plans.

On the other hand, Leonardo could assist the PAF in other areas of the JF-17 Block-III, such as its EW suite, countermeasures, and other avionics (including the cockpit). In fact, Leonardo could also assist the PAF in acquiring an HMD/S for use on the JF-17 from a third-party.

Drones & Special Mission Aircraft

Leonardo could also provide development support – especially in terms of electronic subsystems – for the PAF’s medium-altitude long-endurance (MALE) drone program. In fact, PAC had co-produced Leonardo’s Falco UAV in the late 2000s, so an upgrade path for that program could also be a possibility.

Likewise, should the PAF require additional ISR (intelligence, surveillance, and reconnaissance) aircraft or dedicated EW platforms, Leonardo could assist with subsystems and integration.

Pakistan Navy


Modern Multi-Role Helicopters

In an August 2018 interview with Asian Defence Journal (ADJ), the Pakistan Navy (PN) CNS, Admiral Zafar Mahmood Abbasi, stated that the PN “plans to augment the naval aviation fleet with modern LRMPs (long-range maritime patrol aircraft), modern multi-function helicopters and UCAVs.”

The part about helicopters could be in reference to replacing the Sea Kings, which serve multiple roles in the PN, namely anti-submarine warfare (ASW), anti-ship warfare (AShW), troop deployment, and search-and-rescue/humanitarian assistance and disaster recovery (SAR/HADR).

At IDEAS 2018, Leonardo had displayed mock-ups of its AW101, AW159, and NH-90. However, in terms of supplanting the Sea King, the AW101 and NH-90. However, either one would be a costly acquisition – e.g., Qatar signed onto a $3.2 billion US contract for 28 NH-90 TTH and NFH.

On the other hand, if the goal is to replace the Sea King, the PN would likely start with 4 to 6 aircraft. The total cost, though expensive in relative terms, may be manageable enough (e.g., under $500 m). It should be noted that the cost also includes a maintenance/support and training package, so the contract will not reach its total value until some years after the helicopters are delivered.

Long-Range Maritime Patrol Aircraft (LRMP)

The PN is seeking a new LRMP to complement – and in time, supplant – the P-3C. Leonardo could offer a custom solution by combining various off-the-shelf subsystems to a commercial platform, much like Saab had done with the Swordfish. In fact, the Swordfish’s main radar is the Leonardo Seaspray 7500E.

Fitting the Jinnah Class Frigate

The subsystem suite for the PN’s forthcoming MILGEM Ada corvettes are likely frozen, but Leonardo can offer its radar and other electronics systems for the Jinnah-class frigate. The Jinnah-class will be the fourth ship under the PN MILGEM program. In an interview with Mönch Group, the CNS said, “we are also looking at acquisition of more corvettes for effective contribution in the Regional Maritime Security,” implying that the PN could order additional Jinnah-class frigates (i.e., that it is not a one-off ship project).

Pakistan Army


Tracked & Wheeled Self-Propelled Howitzers

Between 2016 and 2018, the Pakistan Army took delivery of 120 ex-Italian Army M109L tracked SPHs via Leonardo. Besides boosting its tracked SPH numbers, the Army could also look at Leonardo’s upgrade path for the M109L – i.e., turn it from a 39-calibre gun to a 52-calibre gun capable of firing an extended-range shell, such as Leonardo’s Ballistic Extended Range (BER) projectile.

Likewise, the Army could also explore bringing all of its M109A/Ls up to par with India’s newly-inducted 155 mm/52-calibre guns through the upgrade. Additionally, the Army could also look at specific Leonardo subsystems to fit into its wheeled SPH program (assuming that is coming to pass).


A New Transport Helicopter to Supplant the Puma

The SA330 and IAR330 are among the Army’s mainstay transport helicopters. Interestingly, the AW139 is technically at the weight category of the SA330/IAR330, so the Army could leverage Pakistan’s logistics as well as maintenance and forthcoming D-Level MRO base and add more AW139s.

The alternative would mean looking at much costlier helicopters, such as the NH90 or AW101, which are out of Pakistan’s fiscal means given the numbers required.

Leonardo’s Other Offerings

In addition to Pakistan’s existing and potential requirements, it would also be worth looking at Leonardo’s offerings to the market in general. Though unlikely to factor into Pakistan’s plans, these goods do offer an idea of what Leonardo might like to offload or sell to Pakistan.

Used Eurofighter Typhoon Tranche 1

Leonardo has been responding to various fighter bids around the world with surplus/second-hand Italian Air Force Eurofighter Typhoon Tranche 1s. It is unclear how many are available, though Leonardo’s offers are coming within the $1 billion to $1.5 billion bids of countries such as Bulgaria.

The challenge with the Tranche 1 is that it cannot be upgraded to Tranche 2 or Tranche 3 standards, and its electronics suite – though capable – is becoming antiquated. It also appears that efforts to upgrade its mechanically-steered radar to an AESA radar did not materialize.

However, in Pakistan’s context, one idea could be to temporarily lease such fighters to complement the F-16s (i.e., build-up the medium-weight fighter fleet) until Project Azm becomes a factor. The advantage of leasing is that it could be more affordable than an outright purchase provided the fighters in question are immovable – i.e., assets neither Leonardo nor the Italian government are accruing revenue.

Unfortunately, the cost of leasing is that Pakistan will pay money – however minimal – for fighters it will not own in the end (unless it purchases them outright). On other hand, the per-year cost of operating one or two Typhoon T1 squadrons on a lease would be less than a purchase. Pakistan could also tie a big-ticket purchase (e.g., trainers or radars) in-exchange for a favourable lease offer for the Typhoon T1s.

Offsets & Co-Production

In Algeria, Leonardo set-up a joint-venture with the Algerian MoD to locally assemble, sell, and support helicopters to local and foreign markets. In-exchange for a big-ticket contract, Pakistan could request an offset package with Leonardo which could see the latter invest in the country.

For example, should the Pakistan Navy order $500 m in helicopters, Pakistan could tie Leonardo to buying shares in PAC’s AW139 D-Level MRO facility and, in turn, expand it to support other Leonardo helicopters. The benefit of an offset would be that the hard or foreign currency stays in Pakistan instead of exiting as the cost of importing. However, it would be a short-term benefit in that in the long-term, Leonardo’s own Pakistani properties would begin remitting profits back to Italy, the U.K, etc.

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