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Week of November 24, 1997


East Line Crosses The Great Wall

By Vovick Karnozov

On 13 November the leading Russian cargo carrier, East Line, opened its first scheduled cargo service to China. This move is the first step made by a commercial aviation company to take advantage of the recent political changes in the relations between the two great nations - earlier this month President Yeltsin visited Beijing to sign a pack of agreements on demarcation of the Russian-Chinese state border, thereby finalising the process of turning former "potential enemies" into "strategic partners."

It took the two countries about thirty years to pave the way from clashes for debatable geography (like Damanski Island in the Sixties) to mutually-beneficial projects, including ones in the defence sphere. The turning point occurred in 1990, when China ordered 15 passenger airliners (Tu-154M and Yak-42D) and 34 dual-purpose helicopters (Mi-8 and Mi-17)from Russia.

Later, China acquired S-300PMU1 surface-to-air missiles and a dozen Il-76 airlifters. By the turn of the century the Chinese Air Force plans to increase the number of Su-27 fighters in its inventory up to 200, with half of these being assembled in China. Additionally, Russian specialists are participating in the development of new Chinese fighters featuring Russian engines (Lulka-Saturn AL-31 and Klimov RD-33) and radars (Phazatron Zhuk).

Apart from the demarcation, the Russian President and Chinese state officials signed documents aimed at enlarging the volume of trade between the two countries. Amiran Kurtanidze, general director of East Line Aviation, says that his company is going to play an important role in this process. The Chinese market is very attractive to Russian civil aviators, mostly cargo operators. They generate a good income on conveyance of various cargoes between the two countries, chiefly Chinese consumer goods to Russia. Together, four prominent Russian carriers - East Line, Volga-Dnepr, Tesis and Antant-Soyuz - make up to 20 flights daily on Il-76 and An-124 freighters.

East Line holds the largest part of the market, roughly 60%. The company routinely makes 5-7 flights daily to Urumchi, Tyantszin, Shenyan and Shidziyuan. The easterly direction is the most important for the operator, and this fact is reflected in its name. The business is quite specific, says Vladimir Frolov, chief of marketing with East Line. In China, the carrier gets cargoes from so-called "shop-tourists" in the form of tightly-strapped packs weighing from 20 to 60 kilos. Then these are consolidated, transported by road to the nearby airport and loaded into airplanes flying to Russia. The standard charge is $4...$5 per kilo, depending on distance, type of cargo and some other factors.

As a rule, East Line Il-76s flying to China have additional force-bearing ribs in the cargo cabin. These are steel tubes welded to the main framework to provide additional protection for the airplane in situations when it is being loaded to its ultimate capacity plus a little more. The Il-76 ideally fits into the market, with a large cargo ramp in the tail, low-pressure tires and large internal volumes.

Currently, East Line Aviation has a fleet of 11 Il-76 and one An-12 freighters, as well as two Tu-154, one Il-86 and one Yak-42D airliners. Moreover, up to 50 airplanes, mostly Il-76s, are hired from other operators. In 1996, the operator made over 3,000 flights to China, Turkey, United Arab Emirates, Italy, India, Korea and Belgium, transporting nearly 100,000 tonnes of cargo.

East Line Aviation is a member of the East Line group, a 4,500-strong structure with an annual sales volume in excess of $1 billion. The group is actively participating in the development of Moscow's Domodedovo airport, where, except for other property, it owns fuel-and-oil facilities and a large cargo terminal. The latter 5,500-sq. meter facility is operated by the 300-strong personnel of Domodedovo Terminal Cargo (DTC) joint-stock company, serving over ten Il-76 flights daily. In 1996, DTC served 79,400 t of cargo. The second terminal worth $17 million is planed for completion by the end of this year. It will have a capacity of 27 Il-76 flights and a total territory of 11,000 sq.m.


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