In January, the Philippines paid a Russian company the 15% downpayment for 16 Mi-171 heavy-lift helicopters, which will increase the military’s rapid deployment and medical evacuation capabilities as it steps up combat operations to defeat twin internal threats from Maoist-led guerrillas and pro-Islamic State militants.

Defense Secretary Delfin Lorenzana said the P12.7-billion contract for Russian heavy-lift helicopters was signed in November 2021 before Russia launched an invasion, which it called special military operations, in Ukraine, and before crippling sanctions were imposed by the United States and other western countries, as well as Japan and Singapore.

The down payment for the deal was made to LLC Sovtechno Export of the Russian Federation a month before the Feb. 24 invasion. The Department of Budget and Management (DBM) released the funds in December, rushing the deal. There were indications the transactions were hastened because in other military modernization projects it took some time for the funds to be released. A lot of documents would be needed from the time a contract was awarded and signed before the money could be released.

Russia and the Philippines may have skirted the US sanctions by using a little-known company not included in the blacklist. Russia’s main military hardware exporter is a company known as Rosoboronexport, a state-owned enterprise and the world’s second largest arms dealer.

Rosoboronexport was created by Russian leader Vladimir Putin in early 2000 and was granted exclusive rights to supply the international market with Russia’s whole range of armaments allowed for export.

But it was slapped with US sanctions by then-president George Bush in 2006 for selling materials to Iran’s nuclear weapons program, a clear violation of the Iran Nonproliferation Act of 2000. Rosoboronexport was banned from dealing with the United States from 2008 until 2010 when it was lifted in exchange for Russia’s support for a United Nations resolution on Iran’s nuclear weapons program.

But it was again blacklisted in 2017 after Russia annexed Crimea in 2014 and because of its role in the Syrian civil war. The wide-ranging sanctions were imposed under a law passed by the US Congress — the Countering America’s Adversaries Through Sanctions Act (CAATSA). It incorporated a law passed earlier, Countering Russia Influence in Europe and Eurasia Act.

The CAATSA covered not only Russia but also aimed to stop North Korea and Iran from developing nuclear weapons capability. It was a warning to others against transacting with the three countries at the risk of punitive measures from the US.

However, the CAATSA has not prevented Rosoboronexport from expanding its market. Last year, it recorded $52.1 billion in orders from 61 countries, including the Philippines. Rosoboronexport sold drones, combat aircraft, helicopters, and engines, increasing its market share in the Asia-Pacific region to about 50% as of September last year. China and Vietnam are the biggest markets for Russian equipment. Cambodia, Thailand, Malaysia, and Indonesia had, in the past, also bought aircraft and submarines from Moscow.

It has been selling missiles, weapons for ships and submarines, small arms, and various ammunition. Early in the Duterte administration, Russia also sold to the Philippines grenade-propelled launchers. It was uncertain if Moscow had delivered the weapons and ammunition because of the sanctions slapped on Rosoboronexport.

But this did not stop the Duterte government from dealing with Russia, which has been offering to sell a wide range of military hardware, from submarines to armored vehicles. The Mi-17i heavy-lift helicopter deal is a case in point.

Duterte, who publicly idolized Putin as early as when he assumed power in 2016, had apparently committed to his Russian friend to buy Russia’s military hardware despite opposition from local defense and military leaders who favored Western models and equipment.

The military opposed Russian and Chinese equipment because they were not compatible with existing US and Western-manufactured equipment. The military is also not familiar with the maintenance and operations of these equipment. This will disrupt the military’s entire logistics operations, including spares and servicing.

But there were wild rumors swirling in military camps that Duterte would only approve the acquisition of 16 Bell helicopters from Canada in 2018 if the Air Force agreed to buy the Mi-171 helicopters. The Bell deal was scrapped after a Canadian minister criticized the Duterte administration’s human rights record. The Polish-made Sikorsky S-70i Black Hawk helicopters were bought instead. The Philippines sought 32 more Black Hawks from Poland.

The Philippine Air Force could be making good on its promise to the president after getting the Black Hawks by awarding the heavy-lift choppers to Russia. It was initially looking at buying the US-made Chinook, which was more expensive than the Mi-171.

Russia sweetened the deal by giving one free Mi-171 chopper, which will be custom-built for VIP transport. The other MI-171 will be used for troop insertion, transport of supplies and for medical evacuation. If the old Vietnam War-era UH-1H can carry up to 10 to 12 soldiers for insertion in a combat zone, the Mi-171 can transport 24 or double the capacity of the US-made chopper.

It was reported that the Mi-171 was the most widely used in the world, including the US, which used it for training and bought it for allies, like Iraq, Afghanistan, and Pakistan. Russia’s Mi-171 is a lot cheaper compared with its Western counterparts but is not exactly inferior.

The Russian transport helicopter could be a wise choice for the Philippines but could risk sanctions from the US. The deal with Russia came at a time when tensions with the US have escalated due to the situation in Ukraine.

The United States remains as the country’s main source of military equipment given the decades-long security relationship between the two allies, which was spelled out in the 1951 Mutual Defense Treaty.

Washington has increasingly made Manila an important ally, designating it as a major Non-North Atlantic Treaty Organization (NATO) ally in the early 2000. It has also started transferring brand-new equipment, like drones and small arms, to the Philippines.

The Philippines could risk huge cuts in annual military aid from the United States if Washington decides to punish Manila for the Mi-171 deal. In the past, US defense and state department officials had warned against Manila harming the alliance by acquiring Russian equipment.

The Philippines must be prepared for potential sanctions from the United States for the deal.