Friday, May 1, 2009


The Malaysian Defence Industry is still in its infancy to say the least, and that is after 50 years of the country’s independence. Not even a single piece for indigenously designed weapon has been developed and manufactured, and isn’t this a shame? And for how long more will the country remain a nett importer of weapons and essential equipments for its defence forces, that had costs the country billions in public spending.

Even right now, the Armed Forces defence procurement plan relies heavily on foreign purchases. And I know for one that even basic training simulators need to be purchased from overseas, whereas there are already some local companies that have the capacity to developed training simulators, and some have exported their products overseas.

Why have we not given such companies the opportunity to develop training simulators for our Armed Forces? After all, simulator technology is no longer the domain of the developed nations, but such technologies are now available among Malaysians. One will be surprised to know that some of the Malaysians that I have met, have been deeply involved in the development of high end defence simulators overseas. But yet upon their return home, the country finds no meaningful purposes for their acquired skills, knowledge and experience.

And in the purchase of weaponry and essential equipments, we often end up in a one-off purchase, and worse still, without an arrangement with the manufacturer for a transfer of technology. We seemed to be happy to discard the weapons and equipments when there is no longer a consistent supply of spare parts from the original equipment manufacturers, and we are even more happier to quickly plan for the procurement of new weapons and equipments. This has been the trend for the last 50 years, and it is the weapon and equipment traders and agents that becomes rich…………and for some, super rich in double quick time, and all at public expense.

We have seen how some nations of the world have come out from being nett weapon importers to weapon manufactures. Some examples to quote are the Islamic Republic of Iran, the Republic of South Africa, and closer to home, the Republic of Singapore.

It is pointless for me to explain how these countries have today reached such a high level of technical expertise in weapon development, because the facts and information are readily available from the internet. But what had moved these three countries to achieve such high level status in weapon development, is the will of their governments, its armed forces and the people to see that their countries achieve self reliance in defence manufacturing. I cannot say the same for our government, its armed forces and the people.

I am not privy to the amount of funds that the government has allocated for defence research and development, but I do believe, it is just a fraction of what the Singapore government allocates to its defence research organizations. And if we continue to ignore and place little importance to defence research and development programmes and spendings, I see little hope in the country ever achieving its self reliance in the development and manufacture of its defence needs.



mohamad said...


You have raised a very interesting subject and since none of your ex-service friends has responded I would like to offer my views.

I thought there is a company called SMEO which is responsible for manufacturing assault rifles (Styer?) and what has happened?
By normal standard, this company should be building 155MM guns, rockets and missiles on their own.

Judging from your remarks, it appears as if the nation's defence industry has moved to where. I understand everytime when a big defence contract is signed the transfer of technology becomes part of the contract but where the technology transfers disappear to?

I hope the new Defence Minister, YB Dato' Seri Dr. Ahmad Zahid Hamidi, gives a very serious thought of getting the defence industry sorted out. He must put to tasks all relevant defence industry companies which receive hundreds of millions from the government.

Tan Sris and Datuks who are owners of defence industry companies are very responsible people. If they cannot deliver they MUST go if not YB Zahid Hamidi has to fire them.

A very sorry state of affair. You feel ashamed and I feel very disappointed and disgusted!

komando said...







captazhar said...

The reason for this would be none other than personal enrichment. It is an open secret that arms procurement has its kickbacks, the most famous of all would be the hundreds of millions in US$ of commissions collected from the french submarine issue. The sorry sordid tale of lovers, broken promises, blackmail, murder, cover up, the court releases, the no-appeal by the ag and the subsequent disappearance of the lead actor to self imposed exile in uk for 'studies' happens to be a famous international expose.

ArshadRaji said...

Dear All,

Thanks for your inspiring comments. The country should have been manufacturing its own weapons, the way Singapore did, if SMEO had been involved in R&D. Unfortunately, this was not the case; hence there was this deal to sell M4's to the Army. Sadly, the Armed Forces has developed the buying culture, that is costing billions in tax payers money, and nobody really cares.

komando said...

Def Minister, how much time do you need to study all these comments.

Maybe spend another few millions RM to study and find a solution which is long overdue!

Just another Malaysian culture, always studying some problems but no concrete solutions.

All brain dead experts, or asked to tailor make solutions to fit certain quarters!



Maj. Ramachandran Ramaswamy Iyer (Retd) said...

nonjunitDear Dato'
I am not surprised by the bitterness of most comments here. The Industry needs a clear blueprint, not a patronising government that leaves the business to "pretenders". Simply compare us and our friendly neighbour down south. Need we ask where we went wrong? I urge industry players to comment on this post (if they knew this blog exists).

Major (Rtd) D.Swami said...

When the Styer was first introduced, they did not even have rounds compatible to it. They were using M16A1 rounds which caused stoppages and chipping of the ejection port. The Aussies and NZ'er were laready using SS107 rounds which were compatible and suited for the Styer. What was worst, was they modified the sights, instead of a cross hair sight, they modified it to a circle. In a circle you do not have a 'point of aim'. That was simply a "Malaysia Boleh" moment. It was most embarassing during cross training with the Aussies, when asked where is the 'POA' in this sight. Remember our "tanks"(Scorpions), CVR's (Combat Vehicle Reconnaisance) which we claimed as tanks. They modified the guns by placing a 90mm gun on it, instead of the original 72mm. It could only fire forward, and had to be static. The turret system and the gun were not compatible to the hull. It was good as a sitting duck, they forgot the principle of "1 shot 1 kill", in tank warfare there is no second chance. I doubt our defence industry will go anywhere until our politicians place a serious interest in our nation's well being, instead of lining their pockets.

mohamad said...

Dear Dato',

Your statement " Armed Forces has developed the buying culture, that is costing billions in taxpayers money, nobody really cares " really frightens me and all those citizens who care! Do you mean to say that when you were in the service you and other generals also did not care what was given to you by politicians, how much the systems cost and how they affect the military? if so, I am ashame of you and your fellow army generals!

I am very happy to see ex-service bloggers are now coming forward with their comments, some expressing their bitterness and frustration over what is happening to the defence industry. I hope you can extend our dissatifaction and frustration over the defence industry capabilities of our country to PM, Minister of Defence and the generals in Mndef as I don't expect them to read your blogg. We expect changes and the new future to defence industry.

Judging from your views and the bloggers' comments I am seeing real serious problems in defence system aquisition process and defence industry planning and execution in our country.

After reading your blogg and my earlier comments on the subject I did some research by talking to some very senior retired generals and PTD officers. I cannot believe what I heard but on the other hand they have no reasons to tell me lies!

One local company manufactures assault rifles ( Styer) and small arms ammunitions to be used by our army but due to reasons only known to them, our own police force are equipped with M-16s and imported 5.56mm and .303 ammunitions! After many years in operations the company ceased manufacturing the Styer and now doing local assembly of M-16s.

Are we not killing our own defence industry and how can we expect other countries to buy our products?

Aerospace companies are given contracts to maintain government planes and overhaul major components including their engines. We are still sending, for example, MIG-29 engines to Russia for maintenance and overhaul at very high costs. Why this is so? Simple, no attempt has been made to develop our own capability in the country.

Many local companies are capable of building defence vessels such as fast combat boats and missiles craft. However, when the Navy required trooping vessels, we bought CB-90 boats from overseas at very high price instead of engaging local boat builders, which are equually capable, to build them at much cheaper price.

We purchased air defence radars from United Kingdom and Italy. One local company was to undertake the transfer of technology ( TOT ) and if we care to investigate, we would be shocked to know the truth!

We have not been fair to the development of defence industry in this country. After more than 50 years we have progressed nowhere though billions have been spent in defence procurement. Please wake up and get the move on!

If Mahathir were still around in 2020 ( insyaAllah ), he would would ask the PM and Defence Minister, " We are now a fully industrial and developed nation... Show me Malaysian made tanks, APCs, 155mm guns, rockets, missiles, combat ships and planes built by MALAYSIANS?"

The answer to Mahathir is simple but it will be hard to swallow. We feel sorry to Mahathir, the PM, Defence Minister, The Cabinet and ALL of us.

maurice said...

Dear Mohamad,

It was during Tun DR Mahathir's (TDM) time that the defence industries were privatized.He held the mistaken belief that individual entrepreneurs would do better than a GLC, hence a number of defence related companies which were in the hands of the government were passed to individuals.He expects these individuals to do the things that you highlighted in your posting.

However, as usual some of these socalled entrepreneurs let TDM down because they are basically businessmen in search of quick profit.You need a different breed of entrepreneurs to do the things that you mention which is of course rare in this country.

To be fair the situation to my mind is not that frightening.We have few companies now that we can be proud of, to quote a few:SMEA, SMEO, AIROD, SAPURA, DEFTECH, MMC, BOUSTEAD NAVAL DOCKYARD etc.But of course, we could have done better.

The Steyr story is a sad one.At one time we had the expertise and machineries to manufacture the Steyr Rifle on our own but now all that capability is gone.I believe the Government had spent hundreds million of RM to buy the technology and machineries and trained the manpower on the engineering process to manufacture the rifle.I was told the original owner of Steyr (Austria) was highly impressed with the quality of work done by our engineers and technicians.

Why overnight we discard the Steyr technology and opt for Colt tecnology surely is a subject which merits further research by students interested in the defence and national security issues.

I strongly believe the Government should choose a different route if it wants some degree of self-sufficiency in our defence needs.You are right to say that we should be able to manufacture some defence equipment as a matter of national pride.To do that some essential defence companies must be taken back by the government.The government must be prepared to invest lot of money so that one day we can have Malaysia- made rifle, howitzers, mortars, communication equipment, anti-tank missiles, air defence missiles, armored fighting vehicles, tanks and small to large calibre ammunition plant.

maurice said...

We have a blueprint for the development of our local defence industries which has been endorsed by the cabinet.

It is the responsibility of the Defence Industry Council chaired by the Defence Minister to implement the blueprint.

We should not be shy to learn from our mistakes, modify our plans and adopt new strategy in order to achieve the desired results.

I really believe the government should have total control in companies dealing with basic defence products.

History has shown that it is not a waste of public money to invest and be sufficient in certain basic military products just in case the nation has to face unforseen contingencies.Also I believe it has something to do with national pride and dignity.

mohamad said...

Dear Maurice,

I was waiting for Dato' Arshad to response but you are faster than the retired Bragadier to come to my rescue. Dato', I suppose you prefer to reserve your comments or are you feeling very uncomfortable to proceed with further sad stories on national defence industry because you were part of the system which contributed to its failure.

Maurice, from your comments I can sense that you are either a serving military or a retired army officer. I must thank you and Dato' for giving me a lot of education on our country's defence industry which I have very little knowledge, though I was well exposed to other countries' defence industry during my overseas studies.

Maurice's sad Steyr story is an excellent lesson which this country must learn and will not repeat the same mistake. What was wrong with the Steyr rifle? If there were something wrong with it, how in the first place we decided to manufacture the rifle but after satisfactorily producing it we changed to Colts technology?

Who are the political leaders, the generals, PTD officers and businessmen involved in making this strategic decision? Is it another case of making quick bucks from Colts' commission? If so, who they are so that MACC can open an investigation on this case!

Have we ever researched into the reliability and consistency of US Congress towards Malaysia in time of crisis? How far will Colts continue to support SMEO to assemble the rifles if the US Congress prohibits the sale of military weapons to our country during the critical time?
Or, are we thinking of manufacturing another type of assault rifles after the Colts?

Maurice, I have to differ from your views of being proud of few companies which, from your judgement, have done well. When I compare my informations from some serving military, retired servicemen and those who had served with those companies which you mentioned, I have totally different views. While those companies are getting hundreds of millions from the government for their "services" they merely made quick profits with very little budget being channeled for enhancing defence industry capability.

Comparing the long duration of government contracts and their current capabilities with many similar organisations in other countries....sorry, they are nowhere and will not be at par even in 2020.

The government MUST HAVE THE WILL to develop defence industry capabilty. Having just the Defence Council without proper planning and making sure the defence industry companies comply to the government plans and policies will get the nation's defence industry to nowhere.

Defence Industry of this country must be given highest priority by YB Dato' Seri Dr.Zahid Hamidi.

maurice said...

Dear Mohamad,

Let me elaborate a bit on the functions of those companies to understand why the owners are reluctant to engage in any R&D work.

AIROD was set up by the Government purely to service and overhaul RMAF aircrafts.It was never designed to manufacture aeroplanes/aircrafts nor spare parts.

AIROD has done well to market its overhaul and maintenanace expertise, that for a long time the USAF based in Hawaai sent their C130s aircrafts to AIROD for regular maintenance.AIROD in the past has also been successful to get Yemen, Indonesia, Thailand, the Philippines and a few others to send their C130s to Subang on a regular basis.

I believe AIROD is a world-class C130 MRO facility in the Asian region but at the moment has to contend with very stiff competition from Singapore which has managed to beat AIROD in the last USAF C130 maintenance contract.

In the case of SMEO, it was established purely to manufacture small arms ammunition (ie 5.56mm,7.62mm, 9mm and 12 bore shotgun).It was not attended to manufacture medium and large calibre ammunition (ie 12.7mm to 155 mm).

SMEO, however has taken one step further by doing assembly works on medium and large calibre ammunition to meet the MAF requirements.Unlike the small arms ammunition, the medium to large calibre ammunition lacks the required economy of scale to be viable.

SMEO however has not been sucessful to market their small arms ammunition in the international market due to their high pricing structure which cannot be avoided because they have to import all their raw materials overseas.

SMEA which is located in Sungai Buluh has extensive machineries and trained workforce to manufacture aircraft components.SMEA has been successful to persuade European aircarft manufacturers to be their manufacturing vendors for some of their aircrafts components.

One really cannot fault the owner of these establishements because he has to run his business in the normal manner.Businessmen will always look at the bottom line so to speak.

I believe the Government must come up with the requirements on what Malaysia must be self-sufficient with and the necessary funds to produce them, working outside the normal market environment.

About SAPURA, it is perhaps too soon to comment since they have just won a major contract from the Ministry of Defence.They have a big national obligation/commitment to fulfil out of their ongoing mega contract.

I will come back soon on some of the comments you make about the Steyr issue.

maurice said...

Dear Mohamad,

You have posed some interesting and important questions about the Steyr issue.I agree with you the MACC should look into the matter.

I would like to add the following questions for MACC to look into:

Was there an Audit done by Mindef to determine that the Malaysian Steyr Factory has outrun its usefulness in producing the Steyr Rifles when they decided to work with Colt?

Has there been large scale defect reports from the users that the Steyr Rifles are not combat worthy?

Has the Steyr Factory been offered back to the Governement in order to take custody of the Steyr Technology when they decided to work with Colt?

Has the Government conduct an Audit on the latest situation on the Steyr Factory in the interest of the public, as substantial public funds was used in the first place to buy the Steyr Technology from Austria?

maurice said...

Just want to share the following information which was obtained from the USA Army Times about the performance of rifle Colt M4 as compared against 3 other rifles in one Extreme Dust/Sand Test conducted by the US Army in July 2007:

" Newer carbines outperform M4 in dust test.

The M4 carbine, the weapon soldiers depend on in combat, finished last in a recent “extreme dust test” to demonstrate the M4’s reliability compared to three newer carbines.

Weapons officials at the Army Test and Evaluation Command at Aberdeen Proving Ground, Md., exposed Colt Defense LLC’s M4, along with the Heckler & Koch XM8, FNH USA’s Special Operations Forces Combat Assault Rifle and the H&K 416 to sandstorm conditions from late September to late November, firing 6,000 rounds through each test weapon.

When the test was completed, ATEC officials found that the M4 performed “significantly worse” than the other three weapons, sources told Army Times.

Officials tested 10 each of the four carbine models, firing a total of 60,000 rounds per model. Here’s how they ranked, according to the total number of times each model stopped firing:

• H&K XM8: 127 stoppages.

• MK16 SCAR Light: 226 stoppages.

• H&K 416: 233 stoppages.

• Colt M4: 882 stoppages."

Posted by Michael Bane

eli said...

I believe MINDEF should be very selective in selecting the type of defence industry that local companies should be involved. From business perspective, Malaysian market size is small and growth rate slow. It is extremely difficult to survive over time and foreign market penetration is not easy.

Major (Rtd) D.Swami said...

Malaysia's Dfence Industry is a laugh. Let us sort out the boots our soldiers wear, which is of low grade quality, known as Kulit Kraf, some shitty name. It is the most basic necessity of all. If one does not get that right, forget the rest.

mohamad said...

The more I research and listen to facts on the subject from some very senior serving military and veterans, including former
"military chiefs", the more questions I have for the PM, Defence Minister, the generals, the Defence Industry Council and the Defence Research Division (STRIDE?)

Are we really very serious to build our own defence industry?

Dato' Arshad, you were part of the system ( Army ) when you were serving the country. Didn't you, your seniors and "chiefs" make a point to the civilians that the army would not accept any defence system without complete defence industry package? or, were you given a chance at all to contribute to defence industry?

Maurice commented favourably on AIROD, SMEO, SMEA and SAPURA. My findings say otherwise. Agreed, AIROD was originally supposed to carry out RMAF aircraft maintenance
when it was privitised from the RMAF DEBKAT. Yes, they have maintained RMAF planes, but anybody care to ask the RMAF Chief
or reliable foreign aerospace experts as to actual AIROD's credibily and capability. Are RMAF planes out of the AIROD hangers on schedules? Agreed, AIROD was to maintain RMAF planes when they started and of course, we don't expect AIROD to build planes and fighter jets, but as the prime national aerospace company given the responsibility to maintain all government planes.....after more than 20 years, we demand AIROD to be capable of maintaining these planes very professionally and on schedules, including overhaul them!

Instead of getting involved in first line aircraft maintenance of Pilatus PC-7 planes, which should be bread and butter of the RMAF, AIROD must build its capability to excell in overhauling of NURIs,
C-130s, Alouette helicopters,etc,
etc, instead of forcing the RMAF to
buy NURI replacement!

We should be given the opportunity to hear comments from a former Commanding Officers of RMAF DEBKAT (more than 25 years ago) and also from the first MD of AIROD!

SMEA has been successful in getting overseas contract to build certain aircraft parts. Yes, but what happen to the famous MD-3 planes? Mahathir must be very upset as it was his pride and pet project! Remember those SMEA's MD-3planes flying with pride during Merdeka Day parades? What happen to CTRM's Eagle aircrafts? Looks like we made wrong choices, even our own airforce rejects them and we ended up nowhere!

SAPURA? A communication giant given the responsibility for defence communication systems but what had been successfully achieved? By now the military should no longer go to foreign markets like THALES to aquire military radios! SAPURE must be tasked to manufacture comtemporary
radios for Malaysian Armed Forces!

There are many "sad and sorry state of affair" which I have researched but I would rather put the on hold. How I wish, Dato', your surbordinates who are now many stars generals, care to ponder over this subject and take positive steps to buck up the national defence industry before they join you as retirees.

maurice said...

Dear Mohamad,

Let me respond to your questions but I stand to be corrected by other well-informed readers.

SMEA should not be faulted for not continuing with the MD-3 project.Apparently the RMAF prefers the Pilatus for their basic pilot training to the MD-3 hence they stopped ordering the aircraft after the first delivery.

Likewise with the Eagle aircraft configured for unmanned reconnaissance role by CTRM for the RMAF; apparently the RMAF for some unknown reasons has not able to optimize its operational potential.Mind you the project amounted to a few hundreds million ringgit.

And yet the most unbelieveable thing happened, a consortium under CTRM has recently been given the go-ahead to develop a UAV for the Army.

There you are, it create the impression that there is a serious planning coordinatiojn issue at Mindef and MAF HQ.

TDM wants Malaysia to have its own training aircraft and unmanned reconnaissance vehicle but unfortunately not well supported by the MAF and RMAF.The projects lost their momentum when TDM is no longer in power.

mohamad said...

Dato' Arshad and Maurice,

I must thank Maurice for the brave attempt to explain the SMEA's
MD-3 and CTRM's Eagle aircraft.

Unfortunately, my ex-RMAF friend, a former commander of RMAF Flying Training School and Instructor Pilot gave a more convincing story.
The MD-3 is a small two-seater piston plane which was part of the off-set package in the British MOU. The aircraft was never designed and built for pilot training, and it just failed to meet the RMAF pilot training requirements. The RMAF tried to accomodate the MD-3 since it was a home-made aricraft but regretfully it could not be utilised for the first 20 hours of introduction to flying to potential pilots. I was told this aircraft had problems to carry out aerobatics with 2 pilots on board.

MD-3s flown during Merdeka Day was for commetics only, flying to make observers like you and me "syok sendiri" without realising it was an unsuccessful aircraft project. Nobody, even leisure flying organisations such as flying clubs, wanted to buy this aircraft. I am sure Mahathir would feel very disappointed to witness the project went down the drain, but we don't blame him!

Pilatus PC-7 is a turbo-prop aircraft which serves as the flying platform for RMAF basic and advanced flying training in Alor Setar. A modern flying trainer which has nothing to do with MD-3!

The CTRM's Eagle? No, no, it can carry two pilots and not an ideal plane for flying training because of its flying controls configuration. The Eagle could not be marketed and decision was made to turn into home-made UAV with BAE's cooperation. I have been informed that this "over-sized" and very expensive Eagle UAVs will have a very tough time to secure markets.

Dato' and Maurice? Have you heard about CTRM spending hundreds of millions of government funds on a four-seater plane called " LANS-AIR"?. I wonder why it disappeared in thin air!

This is my last comment on this very interesting subject which our country should excell but unfortunately, very few knowledgeable experts care to come forward and comment.

Dato', I observe this subject has received tremendous feedbacks on your blogg and may be you have the last say to bring the curtain down.

maurice said...

Dear Mohamad,

It should be investigated by MACC.

It is in the public interest to find out what happened to the LANSAIR joint venture project.

Is it true that a few hundreds million RM (public funds) had disappeared into thin air without a trace?

If you have the information, you should take the lead.