Mil and Kazan, the Russian companies in the Euromil joint venture, do not foresee the withdrawal of Eurocopter having a major impact on the Mi-38 programme.

Eurocopter's decision to abandon Euromil comes after its was forced to resign the role of chairman, effectively losing control of the venture. Euromil was established in 1992 to develop the twin-engined Mi-38 as a replacement for the Mi-8/17 Hip. Kazan joined in 1999 to build the30-seat machine.

The programme, which was scheduled to make first flight in 2001 with deliveries this year, has suffered long delays and Eurocopter was informed that changes to foreign ownership rules state that non-Russians are no longer permitted to be board members of joint ventures. Laurent Teisseire, Eurocopter general secretary, says: "we have no concerns about the technology but the political orientation of the Russian government is now less favourable to foreign co-operations. The market is getting more stable, but it is not a positive signal about doing business long term."

Eurocopter pulled out following analysis of the first stage, which is now complete, after the first prototype was completed earlier this year. "We had to decide whether it was valid to put any more money into the venture" says Teisseire.

Despite forecasts of around 300 sales of the $11 million helicopters in Russia and neighbouring countries, Eurocopter says issues such as not being able to increase its stake beyond 25% and lack of access to intellectual property, have made the project's future unfeasible. The Russian government controlled 20% of the joint venture previously with each company holding 26.66%.

Russian sources says Eurocopter, which was responsible for the avionics integration, has done little in recent years with Kazan completing the most work with the prototype's production. First flight of the Mi-38 is planned in the next few months.

The Mi-38 programme is safe for now as it is in the list of government programmes, and several stages would need completing before it was possible to cancel development.

Concerns about Eurocopter's long-term participation meant two versions were included in the 2001 government list, a westernised aircraft with Pratt & Whitney PW127H engines and an indigenous variant with Klimov TV7-117Vs.

Kazan Helicopters general director Aleksandr Lavrentiev says $500 million has been invested in the Mi-38, with the Russians bound to pledge an extra $100 million for more prototypes.

Source: Flight International