US sanctions risk may ground Malaysia’s Su-57 MRCA deal

WorldPolitics
5 Aug 2025 • 3:13 PM MYT
Twentytwo13
Twentytwo13

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Has Malaysia’s plan to re-equip its air force with modern, fifth-generation fighters been shot down?
The visit by His Majesty the Yang di-Pertuan Agong, Sultan Ibrahim, King of Malaysia, to Russia on Aug 10 is widely seen as a signal of a new era of cooperation between the two countries – particularly in defence, science and technology, and trade.

Observers believe the centrepiece of the visit is the potential purchase of an undisclosed number of Sukhoi Su-57 Felon fighters to meet the Royal Malaysian Air Force’s (RMAF) next-generation multirole combat aircraft (MRCA) requirements.

The long-rumoured deal gained traction after two Su-57s were expected to appear at the Langkawi International Maritime and Aerospace Exhibition 2025 (LIMA25), in May. One aircraft was reportedly slated for static display, the other for daily flight demonstrations. However, both were no-shows, with no official explanation to date.

A geopolitical analyst, speaking to Twentytwo13 on condition of anonymity, said the deal was “likely”, but could now be off the table – and may not be inked during His Majesty’s Moscow visit.

“The government has to strike a fine balance. There is a distinct possibility that if the deal goes through, we could be sanctioned by the United States under CAATSA,” the analyst said.

CAATSA, short for the Countering America’s Adversaries Through Sanctions Act, is a US federal law passed in 2017 that allows Washington to impose sanctions on countries, entities, or individuals that engage in significant transactions with the defence or intelligence sectors of Russia, Iran, and North Korea.

Section 231 of the law is particularly relevant to defence deals, allowing the US to sanction any country or entity that purchases major military equipment from Russia.

The law was introduced to pressure Russia over its actions in Ukraine and Syria, and alleged interference in the 2016 US elections.

CAATSA has complicated defence purchases for countries such as India, Turkey, and Indonesia – and now possibly Malaysia – especially when it comes to Russian-made Su-35s, S-400s, or Su-57s.

If Malaysia were to proceed with the Su-57 purchase, it could trigger sanctions unless the US president issues a waiver – an option that is possible, but far from guaranteed.

US President Donald Trump’s scheduled visit to Kuala Lumpur in October for the Asean Summit could add further weight to the decision.

“We just came out of tariff negotiations with the US, which saw duties drop from 25 per cent to 19 per cent,” the analyst said.

“But at what cost? It was revealed the price of that reduction exceeded US$240 billion – more than RM1 trillion.”

The concessions reportedly included:

US$150 billion in purchases by multinational firms in Malaysia’s semiconductor, aerospace, and data centre sectors over five years
US$70 billion in Malaysian investments in the US over 10 years
US$19 billion in Boeing aircraft orders by Malaysia Aviation Group (MAG)
US$3.4 billion per year in liquefied natural gas (LNG) purchases by Petronas
US$42.6 million per year in coal purchases by Tenaga Nasional Berhad
US$119 million in annual telecommunications product purchases by Telekom Malaysia

“Skilled negotiations or concessions on our part? That’s up for debate. But one thing is clear – on this score, the US holds the cards. We can’t afford sanctions,” he added.

A defence observer agreed with the assessment but noted that the US may benefit tactically if the deal proceeds.

“The Felon is an unknown quantity. No one's gone head-to-head with it in combat. No one knows how it will be employed or its full capabilities, performance, or weapons envelope,” the observer said.

“If the US expects to be in a shooting war – either in Russia’s backyard or in Southeast Asia – this presents the perfect opportunity to gather intel on it.

“They’ve done this before. ‘Trade’ was brisk when the RMAF operated MiG-29N ‘Fulcrums’, and later the Su-30MKM ‘Flankers’. The Americans treated multilateral air exercises like Cope Taufan, Pitch Black, DACT, and PassExes with the US Navy as real-world post-graduate courses in air combat manoeuvring.”

In June 2024, Twentytwo13 was the first to report that the RMAF was likely to select a Russian fifth-generation stealth fighter as its next MRCA.

Sources now say the first batch of four, most likely Su-57E Felons with uprated engines and improved sensors and avionics, will be delivered under the 14th Malaysia Plan. The RMAF plans to form a full squadron, with final deliveries expected around 2030. Additional orders are possible.

Under the previous CAP55 roadmap, the RMAF had planned to retire the Su-30MKM by 2030-2035, replacing it with a new fifth-generation aircraft.

However, under a new, bold, and accelerated force modernisation programme, the RMAF has advanced its timeline and ambitions.

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