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The U.S. defense budget isn't about to collapse, but the massive spending growth is expected to coming to at an end.
Although the Pentagon's FY2006 suggests a flat budget in the future, the 2006 Budget provides $1.7 billion for unmanned vehicles.
And not all is included in defense budget, see Special Factors / Military investments and budgets.
Also, European militaries are investing to unmanned aircraft for reconnaissance drones and higher-end unmanned combat air vehicles.
Countries such as Japan,South Korea are investing to UAVs, read our analysis: UAVs in different countries and Location.

Xi helicopters, Base4Xi and Sensor4Xi and H2 devices itself combined with networking requirements are complex.
This kind of business requires sophisticated infrastructure and right talent to succeed, read our research Key People.

~ Xi helicopters are rapidly deployable unmanned rotary wing UAV vehicles.
~ Bases4Xi are autonomous & unmanned bases which are being delivered rapidly to hostile areas.
~ Sensors4Xi are wireless networked sensors dropped from Xi helicopter.
~ Freedom Devices might be powered by hydrogen & fuel cells.
~ Pocket Rollable Display(PRD) are new kind of displays.
~ Freedom Device 1 has PRD embedded.
~ Resource Devices are hydrogen magazines and cartridges.

Laws and UAVs:

A company exporting UAVs have to secure an International Traffic in Arms (ITAR) agreement
from the U.S. Department of State which allows it to export UAV products to approved countries.

Risks with UAVs:
Acting Deputy Assistant Secretary for Nonproliferation Vann Van Diepen told a Senate subcommittee
that UAVs are potential delivery systems for weapons of mass destruction,
and there is a potential for terrorist groups to produce or acquire small UAVs
and use them for CBW (chemical and biological weapons) delivery.

He said the United States has attempted to use aggressively "a broad spectrum of measures"
to affect various aspects of the UAV proliferation threat, including the Nuclear Nonproliferation Treaty,
U.S. and multilateral export controls, the Missile Technology Control Regime (MTCR) guidelines,
sanctions against foreign governments involved in proliferation activity,
military and intelligence capabilities, and diplomacy.

Van Diepen warned that the increasing reliance on UAVs worldwide (including in civilian roles)
and the dual-use nature of much UAV technology will make job more difficult in the future.
Testimony of Vann Van Diepen, Acting Deputy Assistant Secretary of State for Nonproliferation,
Provided to the Senate Governmental Affairs, Subcommittee on International Security,
Proliferation and Federal Services, June 11, 2002

What are UAVs?
Unmanned air vehicles is the term used in the Missile Technology Control Regime (MTCR)
to refer to unmanned systems that fly within the atmosphere and are not rocket-propelled.
Different terms may be used in other contexts, but for MTCR purposes this term includes cruise missiles,
as well as target drones, reconnaissance drones, and other forms of UAVs, be they military or civilian, armed or unarmed.
UAVs can be as large as a jetliner or as small as a model airplane,
can be jet or propeller driven; there are even concepts for guided, unmanned blimps that would be UAVs.

Uses of UAVs.
UAVs have been in military service since at least the use of the V-1 cruise missile and target drones in World War II.
Since then, their use has grown dramatically in land-attack (in ground-, sea-, and air-launched modes),
reconnaissance, as targets, and even in some civilian applications such as pipeline inspection and crop-dusting.

The U.S. military is at the cutting edge, with nuclear-armed cruise missiles in the inventory for over 20 years,
and extensive use of conventionally armed cruise missiles and of reconnaissance UAVs in the Gulf War
and most of USA's subsequent military engagements.
As UAVs become more capable (as in the recent use of armed UAVs in Afghanistan),
they are taking on more missions that have been exclusively the province of manned aircraft;
this is expected to grow in the future, with the further development of so called Unmanned Combat Air Vehicles (UCAVs).

The UAV proliferation threat.
These same attributes of UAVs that are so useful for the U.S. military -- for example,
the ability to strike targets with precision and substantial protection from interception
and to collect real-time intelligence --
make UAVs in the hands of USA's adversaries a threat to USA and to USA's friends and allies.
Moreover, UAVs are potential delivery systems for weapons of mass destruction (WMD),
and indeed are ideally suited for the delivery of chemical and biological weapons (CBW)
given UAVs' ability to disseminate aerosols in the right places at the right altitudes.
And while, thus far, the primary concern for adversary use of WMD-armed UAVs has been with nation-states
-- such as Iraq, which has been converting L-29 trainer aircraft to UAVs for probable CBW use
- there is a potential for terrorist groups to produce or acquire small UAVs and use them for CBW delivery.

Dealing with the UAV proliferation threat.
U.S. efforts to impede threats stemming from the proliferation of UAVs
and their technology encompass a broad spectrum of measures.
As in other nonproliferation areas,
the U.S. attempts to use aggressively all of these tools to affect various aspects of the UAV proliferation threat.

The Nuclear Nonproliferation Treaty prohibits the acquisition of nuclear weapons by non-nuclear-weapon states,
and the Biological Weapons Convention and Chemical Weapons Convention prohibit the acquisition of CBW.
This helps dissuade new countries from getting into the WMD (and thus, WMD-delivery) business,
impedes and de-legitimizes WMD proliferation,
and supports the other measures the U.S. takes to fight proliferation.
In addition, the MTCR Guidelines serve as a de facto norm against exports in support of delivery UAVs.

Export controls:
U.S. and multilateral export controls help deny proliferators access to the Western technology (the best technology)
that might be misused to develop WMD delivery systems,
making adversary UAV programs slower, more costly, and less effective and reliable.

MTCR Category I.
The MTCR from its inception in 1987 subjected exports of UAVs inherently capable of
delivering a payload of at least 500 kg
to a range of at least 300 km (so-called "Category I" or "MTCR-class" UAVs)
and their directly associated technology to an unconditional "strong presumption of denial."
Exports of complete guidance sets and warhead safing/arming/fuzing/firing subsystems useable in such UAVs,
and their directly associated technology,also are subject to a "strong presumption of denial."
Exports of the specially designed production facilities for Category I UAVs and their complete subsystems,
and the technology directly associated with such facilities, are prohibited.
(Of course, these strictures apply only to MTCR members and unilateral adherents.)
MTCR Category II.
Key components and materials useable in producing MTCR-class UAVs -- such as

  • small, fuel-efficient jet engines;
  • structural composites and their production equipment;
  • various types of avionics, guidance, and flight control systems;
  • telemetry and ground support equipment;
  • various test equipment;
  • and stealth technology --are controlled as MTCR Category II items.

    MTCR countries review exports of such items on a case-by-case basis against specified nonproliferation criteria,
    and such exports are subject to a "strong presumption of denial" if judged to be intended for use in WMD delivery.
    In 1994, additional UAVs -- those not captured under Category I,
    but inherently capable of a 300 km range regardless of payload --
    were added Category II MTCR controls. Wassenaar.

    In addition to being controlled under the MTCR, military UAVs and their components are controlled
    under the Wassenaar Arrangement
    -- the nonproliferation regime for conventional arms and associated dual-use items.
    Wassenaar also requires controls on the export of a wide range of materials and
    equipment useful in the production of UAVs, beyond those controlled by the MTCR.

    Catch-all controls.
    Moreover, there are a large number of relevant items that are not controlled under the MTCR or Wassenaar,
    mostly because of their broad civil uses (e.g., in manned aircraft).
    On a national basis, the U.S. and most other members of the nonproliferation regimes have enacted "catch-all" controls
    to cover exports of such items when an exporter knows or
    is informed by his government that they are intended for use in WMD programs (including WMD delivery).

    Non-regime suppliers.
    The MTCR Guidelines encourage all countries to unilaterally abide by ("adhere to") the Guidelines.
    To the extent non-MTCR countries apply similar export controls,
    proliferators' efforts to obtain items for their UAV programs are furthercomplicated.
    (Israel and several Central and Eastern European countries have adhered to the MTCR Guidelines.)
    The U.S. has a worldwide program of export control assistance --
    focused on Central and Eastern Europe and the Newly Independent States,
    but also operating in East Asia, the Middle East, and South Asia --
    to help countries enact regime-compatible export control laws and regulations,
    to erect effective interagency export licensing systems, and to improve enforcement.

    In addition to its role as a de facto norm --
    and its export controls covering UAVs down to a range/payload capability of 300 km/0 kg,
    as well as key items of equipment and technology -
    the MTCR also serves as a forum where Partner (member) countries can share information and concerns,
    and coordinate their national missile nonproliferation efforts.
    UAVs have taken on increasing prominence in the MTCR over the past several years,
    including specific attention in the annual Information Exchanges during MTCR Plenary meetings.

    The U.S. has a longstanding, day-to-day program of identifying potential exports of proliferation concern
    (including those related to UAVs) and working with other countries to investigate and,
    if warranted, stop such exports from proceeding.
    While the details of these activities are classified,
    they are an important contributor to achieving USA's nonproliferation objectives.

    A variety of U.S. domestic laws require sanctions against foreign governments
    or (usually) entities involved in proliferation activities,
    including certain activities related to UAVs.
    The threat of sanctions can act as a deterrent to proliferation
    activity, and in some cases the diplomacy surrounding sanctions or waivers can result in positive nonproliferation progress.

    The missile sanctions law
    (amendments to the Arms Export Control Act and Export Administration Act,
    codified in the National Defense Authorization Act for FY 1991)
    requires sanctions against foreign persons knowingly involved in the trade of MTCR-controlled items
    that contribute to MTCR-class missile programs (including UAV programs) in countries
    that are not "MTCR adherents" as defined in the law.
    As a result of one such sanctions case,
    China committed in October 1994 not to export ground-to-ground MTCR-class missiles (including UAVs of this type);
    as far as we are aware, China has abided by this pledge.

    The Iran-Iraq Nonproliferation Act requires sanctions against foreign governments
    or persons that contribute knowingly and materially to efforts by Iran or Iraq
    to acquire destabilizing numbers and types of advanced conventional weapons
    (which include such cruise missiles as the President determines destabilize the military balance
    or enhance offensive capabilities in destabilizing ways).

    Lethal Military Equipment (LME) sanctions
    contained in annual Foreign Relations Authorization Acts and in the Foreign Assistance Act)
    require sanctions against governments that provide LME (which would include cruise missiles)
    to countries on the U.S. terrorist list (Cuba, Iran, Iraq, Libya, North Korea, Syria, Sudan).
    The Iran Nonproliferation Act provides for possible sanctions against foreign persons
    that export to Iran items on multilateral export control lists
    (including the UAV-relevant items on the MTCR and Wassenaar lists).

    Military capabilities:
    USA efforts and those of it's friends and allies to defend against adversary UAVs
    and the WMD they might deliver, as well as to be able, if necessary,
    to destroy adversary UAV holdings and to retaliate against UAV and UAV-WMD use,
    help to deter use of UAVs against USA and to make UAVs a less attractive option for USA's adversaries to pursue.

    Intelligence capabilities:
    Good intelligence is central to all aspects of nonproliferation.
    The U.S. Intelligence Community has done a very good job in building awareness
    within the Policy Community of the UAV threat, and in supporting U.S. efforts to sensitize other countries.

    Intelligence liaison relationships also are important means of facilitating interdictions
    and of assisting other countries' export control enforcement.

    All of the above tools are enabled by active U.S. diplomacy.
    We are a leading member of the WMD treaties and the nonproliferation regimes
    and have worked actively to promote export controls and to obtain behavior changes in sanctions cases.
    Even military and intelligence capabilities require coalitions, access, overflights, etc.,
    which are made possible by diplomacy.
    In addition, we can sometimes use diplomacy directly as a nonproliferation tool,
    independent of the others, to promote good behavior and dissuade irresponsible behavior.

    Energetic U.S. use of all of these tools, and intensive cooperation with USA's friends and allies,
    have had a positive impact in impeding the UAV proliferation threat.
    Adversaries' efforts to acquire UAVs have been complicated, and made more time-consuming and expensive.
    To the extent they have been able to acquire UAVs,
    USA's adversaries have had to settle for systems that are less effective
    and less reliable than if USA's nonproliferation efforts had not existed.

    Conclusion of Laws.

    UAV business requires to be familiar with all laws related to UAVs and export and to collaborate with
    government entities as well as with partners and subcontractors.

    Risks in surveillance,recovering what's left:
  • Wreckage of spy plane found on Kabul hillside
    It could take up to three days to recover what's left of a Canadian spy plane that crashed in Kabul.
    Search crews spotted the wreckage yesterday on a barren hillside on the outskirts of the Afghan capital,
    in the centre of what's believed to be a minefield.
    “I know it's on the side of a hill and it's not easily accessible,” said Major Dyrald Cross,
    who runs the unmanned aerial vehicle, or UAV, programme, according to Canadian Press (CP).
    “It's also in a field that's a high threat of mines,
    so we need the engineers to clear a safe lane to the site for us so that we can recover the pieces.
    That effort, to ensure an 800-metre distance is free of landmines, will take several days.
    “It could take two days or as many as three,” Major Cross said.
    “It will take that long to go that distance, and make it suitable enough that we can recover [the aircraft].
    Soldiers dispatched to find the plane were able to pinpoint its location using a grid mapping system
    that employs a satellite-based Global Positioning System to mark co-ordinates.
    “Just after first light, they were able to spot the UAV roughly at the grid
    that we had received as the last location for it before it shut off,” Major Cross said.
    Flight safety inspectors are being flown into Afghanistan from Ottawa to investigate why the unmanned surveillance plane crashed.
    They will scour the flight data that was recorded as the aircraft was airborne
    and sift through pieces of the wreckage to determine what happened.
    We don't know what the cause of the crash was,” Major Cross stressed.
    We can't say definitively if it was the engine or if it was anything else.
    The engine may have stopped when it hit the ground.
    The $33-million, high-reconnaissance system uses aircraft that are launched by catapult from the back of a truck.
    The UAV is equipped with a 65-horsepower Bombardier snowmobile engine
    that carries its 3 1/2-metre-long frame across the sky,
    and collects data through video cameras mounted in a ball on the underside of the aircraft as it travels at 40 metres per second.
    In Ottawa, the official Opposition defence critic said the government picked the wrong plane for the job.
    “Without even bothering to shop around for the best equipment,
    they blew $33.8-million on a critical reconnaissance tool that won't stay in the air,” MP Jay Hill said in a news release.
    Tuesday's crash left Canadian forces in Kabul with no planes to work with.
    They had taken delivery of four aircraft late last year,
    but two were damaged in “hard landings” in the past two months,
    and another plane crashed Nov. 21 after its parachute failed to open as the aircraft descended.
    The military expects to regain three of those aircraft, now repaired, within a week.
    In the meantime, a German spy plane is being used by the International Security Assistance Force, or ISAF,
    to collect intelligence on the ground.
    There are 2,000 Canadians working in or around Kabul as part of the ISAF.

    Cases and examples:
    ~ Italian UAV crashed in California tests; who pays 10 million dollars UAV ?
    ~ some countries do not allow unpiloted flight

    Note, that Xi helicopters can be deployed rapidly using a manned fighter and helicopter.

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