Turkey, Russia Discussing Financial Terms for Supply of Second Batch of S-400 Systems

Russia and Turkey have commenced discussing financial terms for the supply of a second batch of S-400 air defence systems (ADS) but no sales contract has been signed yet.

“A contract on the delivery of the second batch of S-400 anti-aircraft missile systems to Turkey has been signed and the sides are discussing the contract’s financial terms,” Head of Russia’s state arms seller Rosoboronexport Alexander Mikheyev told reporters on Sunday.

The contract Mikheyev referred is an agremeent to proceed further with the discussions, and not a sales contract, it was later  clarified by Rosoboronexport.

The timeframe of implementing the contract would depend "on our partners’ readiness to finally resolve the procedural issues with the financing of this project," the Rosoboronexport chief said.

Russia and Turkey are in an advanced stage of discussion on the delivery of the second S-400 batch, but the agreement has not yet been signed, Dmitry Shugaev, head of Federal Service of Military-Technical Cooperation, said on Sunday.

"We are awaiting for the decision of the Turkish partners to sign another option contract", Shugaev said in an interview with Zvezda TV.

Mikheyev comments, “resolve the procedural issues with the financing,” are fraught with meaning. Turkey is facing financial constraints  which may affect its ability to pay up to $2.5 billion for the  second set of S-400.

Ankara could be negotiating more favorable terms than it did while ordering the first batch.

Turkey  is under tremendous pressure from the United States to abandon the S-400 deal altogether. The US has suspended Anakara’s participation in the F-35 aircraft project and has threatened sanctions.

A first set of S-400 ADS has already been delivered as per a contract signed  in September 2017 worth $2.5 billion. Under the contract, Ankara received a regiment set of S-400 air defense missile systems (two battalions). The deal also envisages partial transfer of production technology to the Turkish side.